are towing services taxable in wisconsin
Are Towing Services Taxable in Wisconsin?
Yes, towing services are generally considered taxable services in the state of Wisconsin. The Wisconsin Department of Revenue classifies towing services as a “service subject to sales tax” under the state’s sales and use tax laws.
Taxable Towing Services
According to the Wisconsin Department of Revenue, the following towing services are subject to state sales tax:
- Towing of motor vehicles
- Towing of disabled vehicles
- Towing services related to accidents or breakdowns
- Towing services for repossessions or impoundment
- Transportation of vehicles by tow truck
Tax Rate and Billing
The current state sales tax rate in Wisconsin is 5%, which applies to taxable towing services. Some counties and municipalities may also impose an additional local sales tax on top of the state rate. For example, in Milwaukee County, the combined state and local sales tax rate is 5.6%.
Towing companies in Wisconsin are required to charge and collect the applicable sales tax from customers when providing taxable towing services. The sales tax should be clearly listed as a separate line item on the customer’s invoice or bill.
Exempt Towing Services
While most towing services are taxable in Wisconsin, there are a few exceptions where sales tax may not apply:
- Towing services provided to tax-exempt organizations, such as government agencies, non-profit organizations, or religious institutions, may be exempt from sales tax with proper documentation.
- Towing services that are considered part of a larger non-taxable transportation service, such as moving household goods or transporting vehicles for hire, may be exempt from sales tax.
Safety Considerations
Regardless of the tax implications, safety should always be the top priority when it comes to towing services. Towing companies must follow all applicable safety regulations, use proper equipment, and ensure that their employees are properly trained and certified to handle various towing situations.
Typical Costs
The cost of towing services can vary depending on several factors, such as the distance, type of vehicle, and any additional services required. In Wisconsin, typical towing fees can range from $50 to $300 or more, with additional charges for services like winching, off-road recovery, or storage fees.
Conclusion
In summary, towing services in Wisconsin are generally subject to state and local sales tax, with a few exceptions for tax-exempt organizations or specific non-taxable transportation services. Towing companies are required to charge and collect the applicable sales tax from customers and clearly list it on invoices. While the tax implications are important, safety should always be the top priority when it comes to towing services.