The 10% excise tax on tanning services went into effect on July 1st and applies to returns that relate to calendar quarters beginning after June 30, 2010.
The Internal Revenue Service formally published the final and temporary regulations on June 15. We urge you to review these regulations with your tax advisors. These regulations can be accessed here.
The IRS is issuing these regulations as "temporary” to provide guidance to users and providers of indoor tanning services. The text of the temporary regulations also serves as the text of the "proposed” regulations.
Before these regulations are final, the IRS is required to receive and respond to public comment. The deadline for comments was Monday, September 12, 2010. The ITA collected comments from the industry and submitted this letter.
The updated tax document, Form 720 is now available online at the IRS site. See Part II, line 140.
Instructions for Filing : instructions.
The Internal Revenue Service has issued answers to frequently asked questions (FAQs) regarding the Tan Tax. Please use this link to view this document:
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Excise-Tax-on-Indoor-Tanning-Services-Frequently-Asked-Questions
Indoor Tanning Services Tax Center:
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Indoor-Tanning-Services-Tax-Center
IRS Releases Revised Audit Guide on Indoor Tanning Tax -- Updated October 17, 2012
The Internal Revenue Service released a revised audit technique guide for the excise tax on indoor tanning services. The guide outlines what services are subject to the tax, who is liable for the tax, and possible exemptions. It also includes examples for calculating the tax under different circumstances, and details refunds, penalties, and procedures examination agents would follow.
The guide also includes types of questions an examination should ask, what agents should look for when conducting an audit, audit techniques, and indirect methods of tanning revenue determination. Use this link to see the guide: audit technique guide.
Updated Tan Tax Regulations – Disregarded Entities and the Indoor Tanning Services Excise Tax -- Issued June 25, 2012
Under proposed and temporary regulations published in the June 25, 2012, Federal Register, reporting and payment of the Tanning Tax will change for "tax-disregarded” qualified subchapter S subsidiaries and single-member LLCs for the IRS Form 720 due by October 31, 2012 (for payments collected in July, August & September 2012). Specifically, for Tanning Tax collected on payments received on or after July 1, 2012, Form 720 must be filed under the name and employer identification number (EIN) of the "tax-disregarded” entity rather than under the name and EIN of the disregarded entity's owner. CONSULT YOUR TAX ADVISOR TO SEE IF AND HOW THIS CHANGE AFFECTS YOUR BUSINESS.
Any comments about the proposed rule and requests for a public hearing are due to the IRS by September 24, 2012.
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