Free St 108 PDF Template

1. What is Form ST-108?

   Form ST-108, officially known as the Certificate of Gross Retail or Use Tax Paid on the Purchase of a Motor Vehicle or Watercraft, is a document utilized in the state of Indiana. It serves as proof that the gross retail sales or use tax has been collected on the purchase of a motor vehicle or watercraft. This certification is necessary when titling a vehicle or watercraft, ensuring the Indiana Department of Revenue has received the appropriate sales or use tax.

2. Who needs to complete the ST-108 form?

   Dealers selling a motor vehicle or watercraft in Indiana are required to complete the ST-108 form. This form must be filled out accurately by the dealer to indicate the amount of tax collected from the purchaser, which must then be remitted to the Department of Revenue along with a sales and use tax report.

3. What information is required on the ST-108 form?

   The ST-108 form requires detailed information regarding the seller and the buyer, including the dealer’s name, license number, and address, as well as the purchaser's name and address. Vehicle identification details, such as the VIN or HIN, year, make, and model or length, are also necessary. Additionally, the form includes sections for calculating the sales/use tax based on the total selling price and trade-in allowance, if applicable.

4. How do you calculate the amount of sales/use tax on the ST-108?

   To calculate the sales/use tax on the ST-108 form, start with the total selling price of the vehicle or watercraft, including any pre-transfer costs but excluding federal excise tax. If a trade-in allowance for a like-kind vehicle or watercraft is applicable, subtract its value from the total selling price. The resulting amount is then multiplied by 7% (.07), which is the tax rate, to determine the tax amount collected from the purchaser.

5. What are the consequences of providing false information on the ST-108?

   Providing false information on the ST-108 form is a serious matter that could result in the revocation of the dealer's Gross Retail Sales/Use Tax Certificate. This revocation could have significant implications, including penalties and legal consequences for the dealer. It is crucial that all information on the form is accurate and truthful.

6. Can a trade-in reduce the taxable amount on the ST-108 form?

   Yes, a trade-in can reduce the taxable amount on the ST-108 form, but only if it’s a like-kind vehicle or watercraft. This means that the trade-in and the newly purchased item must be of similar types (e.g., a boat for another boat). The value of the trade-in is subtracted from the total selling price to determine the amount subject to tax. Non like-kind items do not qualify for reducing the taxable selling price.

7. What happens if the ST-108 form is not signed?

   If the ST-108 form is not signed by the seller, the form will be rejected by the license branch. This rejection necessitates the purchaser to return to the seller to obtain the necessary signature. A signature on the ST-108 certifies that the sales/use tax has been collected and will be forwarded to the Department of Revenue with the Sales/Use Tax Return.

8. Is there an exemption form related to the ST-108?

   Yes, if a tax exemption is claimed on the purchase of a motor vehicle or watercraft, Form ST-108E, an affidavit of exemption, must be completed by both the purchaser and the dealer. This form lists the available exemptions for qualified purchases and must be submitted to the license branch at the time of licensing.

9. What should you do if the dealer's information is incorrect on the ST-108?

   If the dealer's information on the ST-108 form is incorrect or incomplete, especially the Indiana Taxpayer Identification Number and Location Number in the required format, the form will be rejected. It is essential for the purchaser to return to the dealer to rectify any errors and ensure the form is accurate before resubmission to the license branch.

10. Where do you submit the completed ST-108 form?

    The completed ST-108 form must be submitted to a Bureau of Motor Vehicles (BMV) license branch as part of the vehicle or watercraft titling process. Furthermore, the dealer is responsible for submitting the collected sales/use tax to the Indiana Department of Revenue through a sales and use tax report.

1. Not properly entering the dealer's information, including the Federal Identification Number (FID #), Dealer’s License Number, and the specific format of the Taxpayer Identification Number (TID #) which combines 10 digits plus the 3-digit location number (LOC #). Forgetting to format these numbers correctly or failing to provide them in full can lead to the rejection of the form at the license branch, necessitating a return visit to the dealer to correct the oversight.

2. Omitting or inaccurately completing the Vehicle Identification Information section, particularly neglecting to include the Vehicle Identification Number (VIN) or Hull Identification Number (HIN) as required. The year, make, and model or length of the vehicle or watercraft must also be accurately detailed to avoid issues in the processing of the form.

3. Failing to calculate the sales/use tax correctly, which involves a three-step process: identifying the total selling price (inclusive of all pre-transfer costs minus the federal excise tax), determining the applicable trade-in allowance for like-kind exchanges only, and then subtracting the trade-in value from the total selling price to find the taxable amount before applying the 7% tax rate. Incorrect calculations in this section can result in either underpayment or overpayment of taxes.

4. Overlooking the trade-in information section for those who are trading in a like-kind vehicle or watercraft. This includes not specifying the make, model, year, and ID number of the trade-in item. This omission can forfeit the potential tax exemption on the trade-in value, leading to an inflated tax payment obligation.

5. Not signing the form or neglecting to fill in the date, printed name of the seller, and their title in the signature section. This certification is crucial as it attests to the seller's collection and future remittance of the stated gross retail sales/use tax to the Department of Revenue. Unsigned forms will be outright rejected, causing delays in the registration process for the purchaser.

The Form ST-108 serves a critical function in validating the payment of gross retail or use tax on the purchase of vehicles and watercrafts within Indiana. It's part of a suite of documents often necessary for a seamless transaction and compliance with state regulations. Here, we outline additional forms and documents frequently used alongside Form ST-108, each with its essential purpose in the broader context of vehicle or watercraft purchase and registration.

• Form ST-108E: This is an affidavit of exemption for the state gross retail or use tax on a motor vehicle or watercraft. It is used when a purchaser claims an exemption from the tax, outlining the specific exemptions for which they qualify.
• Application for Certificate of Title: This form is necessary for obtaining a title for the newly purchased vehicle or watercraft. It verifies ownership and is required for registration.
• Bill of Sale: Serving as a receipt for the transaction, the Bill of Sale details the purchase price, date, and particulars of the vehicle or watercraft, providing proof of purchase and transfer of ownership.
• Odometer Disclosure Statement: Federal law requires this document for the sale of most motor vehicles to ensure the buyer is aware of the actual mileage. It's a crucial component of the buying process, offering protection against odometer fraud.
• Loan Agreement: If the purchase involves financing, a loan agreement outlines the terms, including interest rate, payment schedule, and other conditions between the buyer and the lender.
• Power of Attorney (POA): This legal document authorizes a third party to act on the buyer’s or seller's behalf in transactions, such as registering the vehicle or watercraft, especially if either party cannot be present.
• Registration Application: To legally operate the vehicle or watercraft, the buyer must submit a registration application to the appropriate state agency, which usually requires proof of insurance and payment of registration fees.
• Proof of Insurance: Most states require proof of a valid insurance policy for registration, demonstrating that the vehicle or watercraft meets the minimum coverage standards.

Understanding each of these documents and how they interact with Form ST-108 is vital for anyone involved in the sale or purchase of a motor vehicle or watercraft in Indiana. They ensure transparency, compliance with tax laws, and protection for all parties throughout the transaction process.

• The W-9 Form, or Request for Taxpayer Identification Number and Certification, shares similarities with the ST-108 Form in that it collects the seller's Federal Identification Number (FID#). Both forms are used to ascertain tax-related identification and information from individuals or entities engaging in transactions that have tax implications. The W-9, much like the ST-108, requires the individual or entity to certify the accuracy of the information provided, under penalty of perjury.

• The Title Application for vehicles or watercraft is another document that parallels the ST-108 Form. Both require detailed information about the vehicle or watercraft, including the Vehicle Identification Number (VIN) or Hull Identification Number (HIN), make, model, and year. This information is necessary for proving ownership, tax collection, and registration purposes. The focus on the identification of vehicles or watercraft makes both forms essential in the transactions they are designed to facilitate.

• The Sales and Use Tax Return form is closely related to the ST-108 Form in terms of its purpose. The ST-108 facilitates the collection of sales/use tax at the point of sale, while the Sales and Use Tax Return is the document on which the collected tax is reported to the tax authorities. In essence, the ST-108 Form provides the initial step of collecting tax from the purchaser, and the Sales and Use Tax Return completes the process by remitting the tax to the government. Both are integral in ensuring the compliance with state tax laws.

• The Bill of Sale document shares similarities with the ST-108 as both serve as evidence of a transaction between a buyer and a seller. While a Bill of Sale documents the transfer of ownership and the transaction details between the parties, the ST-108 specifically records the transaction for tax purposes. Both documents are critical for legal and tax compliance, detailing the parties' information, the item sold, and financial transactions involved, including the sales tax collected, if applicable.

Filling out Form ST-108, which is the Certificate of Gross Retail or Use Tax Paid on the Purchase of a Motor Vehicle or Watercraft, is a critical step during the buying process. To make sure you complete this form correctly and avoid any potential setbacks, here are 7 dos and don'ts to keep in mind:

• Do ensure that you have the correct form. Form ST-108 is specifically for reporting tax paid on the purchase of a motor vehicle or watercraft in Indiana.
• Do carefully read the instructions provided with the form before you start filling it out. Understanding what is required can help prevent mistakes.
• Do clearly print or type the information to avoid any confusion. This includes the dealer’s information, your information as the purchaser, and details about the vehicle or watercraft.
• Do have the dealer’s Registered Retail Merchant Certificate Number (RRMC #), Federal Identification Number (FID #), and the Vehicle Identification Number (VIN) or Hull Identification Number (HIN) handy. These are crucial pieces of information that need to be accurately reported.
• Do calculate the sales/use tax correctly. Make sure to include any cost that adds to the total selling price before applying the 7% tax rate.
• Don’t leave any sections blank. Incomplete forms may be rejected. If a section does not apply to your purchase, indicate this with a “N/A” (not applicable) rather than leaving it empty.
• Don’t forget to sign and date the form. The form is not valid without the seller’s signature, confirming that the sales/use tax was collected and will be forwarded to the Department of Revenue.

By following these guidelines, you can ensure that the process of reporting and paying the necessary taxes on your vehicle or watercraft purchase is smooth and error-free. Remember, accurate and complete documentation is key to avoiding delays or additional trips to the license branch. Take your time, double-check your work, and make sure every piece of information is correct and clearly stated.

There are several common misconceptions regarding the ST-108 form, which is essential for reporting and paying gross retail or use tax on motor vehicle or watercraft purchases in Indiana. Understanding these misconceptions is crucial for both buyers and sellers to ensure compliance with Indiana tax law.

• Misconception 1: The ST-108 form is only for automobile transactions. While the ST-108 form is commonly associated with automobile purchases, it is also required for the purchase of watercraft. The form accommodates both types of vehicles by providing a section to enter either a Vehicle Identification Number (VIN) or a Hull Identification Number (HIN).
• Misconception 2: Trade-in vehicles are not accounted for on the ST-108 form. The form specifically includes a section for trade-in allowances, reflecting like-kind exchanges only. This means the value of a trade-in can reduce the taxable amount of the new purchase, provided it is a similar type of vehicle or watercraft.
• Misconception 3: Federal excise taxes are included in the total selling price. When calculating the total selling price on the ST-108 form, federal excise taxes should not be included. This is a specific exclusion, ensuring that the tax calculation is based solely on the price before any federal excise tax is applied.
• Misconception 4: Any correction or omission on the ST-108 form can be easily fixed directly at the license branch. If the ST-108 form is missing the required Indiana Taxpayer Identification Number in the correct format or is otherwise incomplete or incorrect, the license branch will reject it. The purchaser must then return to the seller to correct the form, which can significantly delay the registration process.
• Misconception 5: The ST-108 form is the only document required for tax exemption claims on vehicle purchases. To claim an exemption from the sales/use tax, both the purchaser and the dealer must complete Form ST-108E, indicating the specific exemption being claimed. This form serves as an affidavit of exemption and must be submitted at the time of licensing.
• Misconception 6: The dealer’s signature on the ST-108 form is not mandatory. The completion and signature of the seller are mandatory for the form to be considered valid. Without the seller's certification that the tax has been collected and will be forwarded to the Department of Revenue, the form will be rejected at the license branch.
• Misconception 7: The sales/use tax rate applied is negotiable or varies. The tax rate applied to the amount subject to tax is a fixed 7%. This rate is applied uniformly across all transactions that are subject to sales/use tax in Indiana, ensuring consistency and simplicity in tax calculations on motor vehicle or watercraft purchases.

Understanding these key points can help ensure that the ST-108 form is completed correctly and efficiently, facilitating a smoother transaction process for both the seller and the purchaser.

Understanding the Form ST-108 is crucial for anyone purchasing a vehicle or watercraft in Indiana. This form serves as a certificate of the Gross Retail or Use Tax that has been paid at the time of purchase. Here are key takeaways about filling out and using the ST-108 form:

• The ST-108 form is required by the Indiana Department of Revenue for certifying that state gross sales and use tax has been paid on the purchase of a motor vehicle or watercraft.
• It is essential for the dealer's information, including the Registered Retail Merchant Certificate Number (RRMC #), which is a combination of TID # and LOC #, Federal Identification Number (FID #), and Dealer’s License Number to be accurately filled in. This information verifies the dealer's legitimacy and tax compliance.
• The Vehicle Identification Number (VIN) or Hull Identification Number (HIN), along with the year, make, and model or length of the vehicle or watercraft, must be correctly entered to identify the purchase.
• The calculation of the sales/use tax includes the total selling price, trade-in allowance for like-kind exchanges, the amount subject to tax, and the amount of tax collected, which is crucial for understanding the financial obligations resulting from the purchase.
• A trade-in allowance is applicable only for like-kind vehicles or watercraft; for example, a boat may be traded for a car. However, the value of non like-kind items will not reduce the taxable selling price.
• The seller must sign the ST-108 certifying that the sales/use tax has been collected from the purchaser. This signature is a mandatory requirement for the form’s acceptance.
• If the tax is not documented as paid on the ST-108 form, the purchaser may have to pay the tax directly at a Bureau of Motor Vehicles license branch.
• For tax-exempt purchases, both the dealer and purchaser must complete Form ST-108E, which is an affidavit of exemption. This form needs to be presented at the time of licensing to claim any exemptions.
• Incorrect or incomplete ST-108 forms will be rejected by the license branch, requiring purchasers to return to the seller to correct the errors. This underscores the importance of accuracy and completeness when filling out the form.

Adhering to these key points ensures that the purchase process for a motor vehicle or watercraft complies with Indiana's legal requirements, preventing any unnecessary delays or issues arising from the taxation aspect of the transaction.