Instructions For Form Op-186 - Q & A On The Connecticut Individual Use Tax printable pdf download

Q & A on the Connecticut Individual Use Tax

Here are answers to some commonly-asked questions about the Connecticut use tax. Understanding use tax provisions is important

because failure to comply can result in payment of interest and penalties. You must pay the Connecticut use tax on taxable goods and

services when a Connecticut merchant fails to collect Connecticut sales tax from you or when you purchase taxable goods or services for

use in Connecticut from an out-of-state merchant.

1. What is the use tax?

Example: You purchased a $1,000 refrigerator in another state, and

paid a $50 tax to that state. If you bought the refrigerator for use in

Use tax is the tax you pay when Connecticut sales tax is not paid to a

Connecticut, you owe Connecticut use tax. The Connecticut tax of $60

retailer. The use tax is complementary to the sales tax. Together, the

is reduced to $10 after allowing $50 credit for the tax paid to the other

sales and use taxes act to tax Connecticut purchasers equally, whether

state. If no tax was paid to the other state, Connecticut use tax is $60.

they purchase goods and services within or without Connecticut.

9. Is an out-of-state merchant misleading me if he tells me I do

2. On what kinds of goods or services must I pay use tax?

not need to pay Connecticut use tax?

You must pay use tax on taxable tangible personal property, whether

Yes. While you may not have to pay sales tax in the state where you

purchased or leased. Examples of taxable tangible personal property

bought the goods or services, you must pay Connecticut use tax on

include items of clothing costing $50 or more, automobiles, appliances,

taxable goods or services purchased for use in Connecticut.

furniture, jewelry, cameras, VCRs, computers, and computer software.

Some taxable services include repair services to your television, motor

10. Do I owe Connecticut use tax on all my out-of-state purchases

vehicle, or computer; landscaping services for your home; and

of taxable goods and services?

reupholstering services for your household furniture.

No. If all the items you purchased and brought into Connecticut at one

3. Are there exemptions from the use tax?

time total $25 or less, you do not have to pay Connecticut use tax. The

$25 exemption does not apply to items shipped or mailed to you.

Yes. Some examples are items of clothing that cost less than $50 or

repair and maintenance services to vessels.

11. Can an out-of-state business, such as a mail-order company,

collect Connecticut use tax on taxable goods that are mailed

Additionally, use tax does not apply to sales of residential weatherization

or delivered into Connecticut?

products during the period that begins on November 25, 2005, and

ends on April 1, 2006.

Yes. If the business is registered to collect Connecticut use tax, it must

collect the tax from you. If the business is not registered, then you

4. What is the use tax rate?

must report and pay the tax yourself.

In general, the use tax rate for purchases of taxable goods or services

12. Does a person engaged in a trade or business have to pay use

is 6%. However, computer and data processing services are taxed at

tax on purchases made for the trade or business?

1%.

Yes. If the person makes taxable purchases of goods or services

5. What if a Connecticut retailer doesn’t collect tax from me on a

out-of-state for use in a trade or business (such as office furniture,

sale of taxable goods or services?

computers, and supplies), that person should be registered with DRS

You must report the use tax liability on your Connecticut income tax

for business use tax purposes and report purchases on Form

return, Form CT-1040EZ, Connecticut EZ Resident Income Tax Return,

OS-114, Sales and Use Tax Return. (See Informational Publication

Form CT-1040, Connecticut Resident Income Tax Return,

2003(31), Q & A on the Connecticut Use Tax for Businesses and

Form CT-1040NR/PY, Connecticut Nonresident or Part-Year Resident

Professions.)

Income Tax Return, Connecticut Telefile Tax Return, or Form

13. What are the penalties and interest for not paying the use tax?

OP-186, Connecticut Individual Use Tax Return, for purchases made

during the preceding calendar year.

The penalty is 10% of the tax due. Interest is charged at the rate of 1%

per month from the due date of the tax return. There are also criminal

6. When must individuals pay the use tax?

sanctions for willful failure to file a tax return.

You must file your Connecticut income tax return by April 15 for the

14. What are the use tax filing requirements for motor vehicles,

preceding calendar year. If you are not required to file a Connecticut

snowmobiles, vessels, and aircraft?

income tax return, you must pay the use tax using Form OP-186. You

may file Form OP-186 for the entire year or you may file several returns

Generally, if the item is not purchased from a retailer, the Connecticut

throughout the year, but, in either case, Form OP-186 is due by April 15

Department of Motor Vehicles collects the use tax when you register a

for the preceding calendar year. If the purchases are made in connection

motor vehicle, snowmobile, or vessel. You must report the use tax

with a trade or business carried on by an individual, see Question 12.

liability on aircraft on your Connecticut income tax return or on Form

OP-186. If you do not intend to register your motor vehicle, snowmobile,

7. What if I buy taxable goods or services from an out-of-state

or vessel immediately after you purchase it, you must report the use

mail-order company, television shopping channel, or

tax liability for purchases made during the prior calendar year on your

computerized shopping service and no Connecticut tax is

Connecticut income tax return or Form OP-186. If the purchase is made

charged by the vendor?

in connection with a trade or business carried on by an individual, see

If you buy goods or services for use in Connecticut, you must report

Question 12.

the use tax liability on your Connecticut income tax return or Form

15. On what amount should the use tax be calculated?

OP-186 for purchases you made during the preceding calendar year.

Calculate the use tax by multiplying the total cost of the taxable goods

8. What if I buy taxable goods or services in another state and

or services purchased, including separately stated charges such as

the vendor charges sales tax for the other state?

shipping and handling, by the tax rate (generally 6%).

If the goods or services were purchased for use in Connecticut, and

For More Information: Forms and publications are available by calling

you have taken title to the goods outside Connecticut, and the tax

860-297-4753 (from anywhere), or 1-800-382-9463 (in-state) and select

correctly paid to the other state is less than the Connecticut tax, you

Option 2. TTY, TDD, and Text Telephone users only may transmit

must report and pay the use tax. Your use tax is the difference between

inquiries anytime by calling 860-297-4911. Internet: preview and download

the Connecticut tax and the tax paid to the other state. If the tax paid

forms and publications from the DRS Web site at

to the other state is equal to or more than the Connecticut tax, you owe

no use tax to Connecticut. There is no refund for tax paid to another

state when that state’s tax rate exceeds 6%.

OP-186 Back (Rev. 12/05)

Instructions For Form Op-186 - Q & A On The Connecticut Individual Use Tax

Related Articles

Related forms

Related Categories