As most of the tanning business owners know by now you will have to incur a new tax starting on July 1, 2010 thanks to the Affordable Care Act. Below are 9 tips on the tanning excise tax that you will have to collect.
1. If your tanning business uses ultraviolet bulbs you have to collect 10% excise tax when the customer pays for your tanning service.
2. If you don’t collect the 10% excise tax from the customer you will be liable for it.
3. This 10% tax doesn’t apply to phototherapy services.
4. Spray tanning is exempt from this tax.
5. If a customer purchases an ultraviolet tanning service and other goods those items are exempt from the 10% tax if they are separately stated.
6. If a packaged deal is purchased which includes ultraviolet tanning service plus other goods and they are not separately stated you must apply the tax to the portion of the payment that can be reasonably attributed to the indoor tanning services.
7. The 10% tax does not have to be paid on membership fee’s for qualified physical fitness facilities.
8. Tanning business owners must pay the excise tax on a quarterly basis.
9. To pay your tax complete Form 720 which is the Quarterly Federal Excise Tax Return.