Did a commercial printer have to report and remit sales tax for the return period when the customer had not yet paid the invoice?

Plain-English summary

Utah Private Letter Ruling 92-007 responded to a commercial printer concerned that customer invoices were collected 60 to 95 days after billing.

The printer argued that it should not have to pay the state before collecting sales tax from its customer.

The Commission said the sale had to be reported and tax remitted for the period when the sale was made, regardless of whether the account had been collected.

Reporting period

State law required remittance of tax with the return for all sales made during that return's period.

If a sale occurred during a period, it had to be reported on that period's return.

An unpaid customer account did not postpone the reporting requirement.

Other issues in the request

The printer also complained about use tax on prepress supplies and plates and described the printing industry's economic and tourism-related concerns.

The response supplied cited statutes and rules as the pertinent information but did not state a separate holding on the prepress-and-plates issue.

It directed the tourism-policy concern to the requester's state legislator.

This page therefore does not infer a substantive answer beyond the explicit remittance ruling.

Holding

Under the response:

• All sales made during a return period had to be reported for that period.
• Tax was remitted with that return.
• Customer nonpayment by the filing date did not defer reporting or remittance.

What this means for you

Sellers with long payment terms

Customer payment timing did not control the sales-tax return period under this ruling. Maintain records showing when each taxable sale occurred.

Commercial printers

Separate tax-return timing from any distinct dispute about the taxability of printing inputs or out-of-state work.

Accountants and bookkeepers

Review current rules for bad debts, credits, canceled sales, and filing methods rather than assuming this short 1992 response covers them.

Common questions

Q: Could the printer wait to remit tax until the customer paid?

A: No.

Q: Which return included the sale?

A: The return for the period in which the sale was made.

Q: Did the ruling expressly resolve the printer's prepress-and-plates argument?

A: No. It cited pertinent statutes and rules but stated no separate holding on that issue.

Key source language

• Remittance: “State law requires the remittance of the tax with the filing of the return for all sales made during the period of such return.”
• Uncollected account: “the sale must be reported in the return for that period regardless if the account has not been collected.”

Citations and references

• Utah Code Ann. § 59-12-101
• Utah Code Ann. § 59-12-102(8)(a), (9)(a)-(d), (10)
• Utah Admin. Rule R865-19-1S
• Utah Admin. Rule R865-19-20S

Source

• Landing page: Utah Private Letter Rulings
• Official ruling: Utah PLR 92-007
• Scope note: the source contains the printer's broader petition, but the Commission's explicit substantive response addressed reporting and remittance before collection.
• Fetch note: the exact official URL returned HTTP 404 to a direct request and was then retrieved through Sofya.

Original ruling text

92-007

July
10, 1992

XXXXX,
Owner/Manager

Dear
XXXXX:

I
am responding to your letter of April 17, 1992 sent to Chairman R. H. Hansen regarding the payment of sales tax prior to collection by the seller.

State
law requires the remittance of the tax with the filing of the return for all sales made during the period of such return. In your example, if a sale is made, the sale must be reported in the return for that period regardless if the account has not been collected. I am enclosing copies of Utah Code Ann. Sections 59-12-101 and 59-12-102. The relevant subsections of Section 59-12-102 are (8)(a), (9)(a), (b), (c), and (d) and (10). I am also enclosing copies of administrative rules R865-19-1S and R865-19-20S. This data is the pertinent information you need in response to your inquiry.

Insofar
as your comment on the state support of tourism, that is an issue that would need to be addressed to your state legislator. You should point out to your representatives your concern about the printing industry in bringing in outside work and retaining employees.

Should
you need any additional information, please feel free to contact me.

Sincerely

Joe
B. Pacheco

Commissioner

R.
H. Hansen

Chairman

Utah
State Tax Commission

160
East 300 South

Salt
Lake City, UT 84134-0700

RE: Petition for Redetermination of Sales/Use
Tax

Dear
Mr. Hansen:

We
appreciate your reviewing this matter for us.

Use
Tax on Prepress & Plates

1.
Printing is an industry that brings out of state money and full time jobs into the state of Utah

2.
Profit is small and we must pay shipping to get out of state work.

3.
When the state adds sales/use tax that printers in other states do not have to pay it makes bringing out of state money and jobs to Utah that much harder.

4.
The printing industry nation wide is in a recession that has major printers from New York to Los Angeles closing their doors. You can check the state records for printing closures and Chapter 11.

5.
All supplies and plates consumed in a job are figured into the total job price. Taxing the printer on these items is double taxation.

Collection
of Sales Tax Prior To Collection By Seller:

1.
Sales in commercial printing are billed and collected on a 60 to 95 day rate. These accounts have not been collected when we must pay state sales tax. I feel that the state should not be paid before the tax is collected.

2.
Some out of state purchasers elect to pay Utah sales tax. We must borrow to pay sales tax on these accounts when sales tax comes due before we are paid. We are not required to tax these sales but do so for our customers convenience. We have collected over $26,000 from this kind of sales tax over the last 3 years.

The
state budgets 3 million to support tourism, (840,000 to support the winter tourism).

The
printing industry needs some help to bring in outside work and keep employees in jobs.

Sincerely

XXXXX

Owner/Manager