Step-By-Step Instructions For Form St-501 (Page 2 of 4) in pdf

(Rev. 7/31/12)

STEP-BY-STEP INSTRUCTIONS FOR ST-501

5193

Please read this section before completing your form.

If you have a retail license or use tax registration you are required to file a tax return even

if there is NO TAX DUE for the period.

WHEN FILING "NO SALES" RETURNS, please enter zeroes on lines 1, 3, 9 and 11 only on the ST-501.

COMPLETE THE SALES AND USE TAX WORKSHEET ON THE BACK OF THE ST-501 BEFORE MAKING ENTRIES

ON LINES 1 THROUGH 18.

IMPORTANT: If it is determined that no entry is needed on a line, PLEASE LEAVE LINE BLANK. Do not write on the lines

that do not pertain to you.

All entries must be typed or hand printed. If using a non-preprinted form, see the introduction section under Essential

Information for form ST-501 for instructions.

The sales tax (6%), tax on durable medical equipment and related supplies (reduced to 1.75% from 3.5% effective July 1,

2012), and local taxes must be separately reported on the appropriate tax forms.

STEP 1

COMPLETING THE SALES AND USE TAX WORKSHEET #1

LINES 1 through 6

Line 1 Gross Proceeds of Sales/Rentals and Withdrawals for Own Use:

Enter the total amount of all sales (taxable and nontaxable), leases and/or rentals made by the business for the reporting period.

Nontaxable sales are to be itemized on line 4 and deducted on line 5. DO NOT INCLUDE THE AMOUNT OF SALES TAX

COLLECTED. Do not include your sales of durable medical equipment and related supplies paid by funds of the State or United

States under the Medicare or Medicaid program.

You must also report purchases of tangible personal property (merchandise, equipment, etc.) purchased tax free at wholesale, but used

by you and/or your employees.

Line 2 Out-of-State Purchases Subject to Use Tax:

Enter the total purchases of tangible personal property purchased from an out-of-state retailer for use, storage, or consumption in this

state if an equal or greater amount of sales tax or use tax was not paid in the other state at the time of purchase. If the tax rate in your

county is greater than the tax rate paid out-of-state, contact SCDOR for additional information.

Line 3 Total:

Add lines 1 and 2. Enter total here and on Line 1 on the front of ST-501. If local tax is applicable, enter this amount on line 1 of ST-389

worksheet.

Line 4 Sales and Use Allowable Deductions:

The state sales and use tax law provides several deductions (exemptions and exclusions) for sales and use tax purposes. There are full

and partial deductions for the state sales and use tax. Before any deductions may be itemized (claimed) on your state sales and use tax

return, the gross proceeds of sales must be reported on the state tax return (ST-501) worksheet (lines 1 and 2). To claim a deduction on

this section of the ST-501 return, it should be listed on line 4 by the type of deduction and the dollar amount.

The list below is used to identify some of the items that may be shown as a deduction. Any amount claimed as a deduction on your

return must be itemized on the worksheet.

Examples of Allowable Deductions: (Not all inclusive)

Sales for resale

Trade-ins

Out-of-state sales

Excess over tax cap

Exemptions:

Manufactured Home (35% of exemption)

Manufacturing

Food purchased with food stamps

Agriculture

Sales tax holiday exempt sales

Federal Government

1% tax reduction for purchases made by individuals age 85 or older

Medicine and prosthetic devices (by prescription)

(1% tax reduction does not apply to local tax calculations)

Diabetic Supplies (by written authorization)

Unprepared food eligible to be purchased w/USDA food coupon

Gasoline sales

(local tax applies if not specifically exempted by local tax)

Installation charges (separately stated on invoice)

Note: Sales that are exempt from the state sales and use tax rate are generally exempt from the local tax rate. However, it is important

to note that certain amounts itemized as a state sales tax deduction on line 4 and subtracted on line 5 of the state tax return worksheet

(reverse side of ST-501) may be subject to a local tax since the local tax may not specifically provide such an exemption.

For instance: 1% of the state sales tax and use rate for individuals age 85 and older is excluded from the state sales and use tax

calculations. Therefore, an amount which is equivalent to 1% of gross proceeds of sales to such an individual is allowed as a deduction

from gross proceeds of sales for state sales and use tax purposes. However, the total amount (gross proceeds of sale) of such a sale is

subject to all applicable local sales and use taxes since the local taxes have no such exemption.

Step-By-Step Instructions For Form St-501 Page 2

Related Articles

Related forms

Related Categories