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Manufactured Homes

Tax due at sale of factory-built home on leased land

By LEN BONIFIELD
Published October 14, 2006

The issue of sales tax due on the sale of a manufactured home on leased land came up recently at a meeting of Polk County officials on various tax issues.

Sales tax also has come up recently in letters from readers who planned to sell their homes.

Let's start with two important definitions:

* If your factory-built home is on leased land, it is considered tangible personal property and is subject to the sales tax law.

* If your factory-built home is on land owned by you and appraised as real property by the county appraiser, it is considered real property and is not subject to the sales tax law.

What taxes are assessed on the sale of the home? The state sales tax of 6 percent, plus any additional discretionary sales tax levied by the county. Polk County, for example, has an additional 1 percent discretionary tax that must be added to the 6 percent for the first $5,000. Thereafter a flat 6 percent is due on the balance of the selling price.

Discretionary sales taxes can vary by county up to 2½ percent, always on the first $5,000 only of sales of tangible personal property. Only nine Florida counties levy no discretionary sales tax.

The next important point is: From whom are you buying or to whom are you selling the factory-built home on leased land? If you are buying from a dealer, broker or agent who is required to be registered with the Department of Revenue, the full selling price is subject to sales tax. You cannot separate appurtenances or extras from the full selling price when a dealer is involved.

If someone purchased a home from the park owner, who is considered a dealer, and the home was completely furnished and installed on the lot with carport, shed, etc., sales tax is due on the final sales price including all those items. Here's a simple rule: If a registered dealer is involved, the sales tax is due on the total selling price.

If an individual is selling to an individual no dealer involved, then determining the sales price is a little more complex. The appurtenances may be deducted from the total selling price. These items must be detailed, priced and a notarized affidavit completed to qualify for the deduction. The Florida Administrative Code Rule 12A-1.007 states: "The occasional or isolated sale of a mobile home, when such mobile home is tangible personal property within the meaning of this subsection, is taxable. The internal plumbing, heating, air conditioning, electrical systems, and attached fixtures, such as built-in ovens, built-in dishwashers, hot-water heaters, and built-in furniture, are considered a part of the mobile home and are taxable when sold with the mobile home. However, tax does not apply to the occasional or isolated sale of carports, utility sheds, furniture, freezers, ceiling fans, washers and dryers, refrigerators, drapes, air conditioner compressor/condenser units located outside the mobile home (note: landscaping, such as trees, bushes, etc., is not deductible), or other appurtenances which are sold in conjunction with the mobile home, provided the selling party to the occasional or isolated sale separately describes each appurtenance on his sales invoice and the sales invoice is sworn to before a notary. If the appurtenances are not separately described and the sales price of each appurtenance is not separately itemized and the sales invoice is not notarized, the total selling price is taxable. Sales of appurtenances by a person registered or required to be registered as a dealer are taxable."

It is not wise to attempt to inflate the price of items to be deducted. When the form is filed with the tax collector's office and a new title is applied for, the price of each item will be carefully reviewed.

The Polk County tax collector's office provided me with a copy of the bill of sale form they use. If you are an individual selling or buying a home, you may obtain a copy of this form from your county tax collector's office, or you may prepare your own. If you prepare your own, make sure to include all the pertinent information regarding the home, the detail of items to be deducted, the perjury clause and a section to be notarized.

Anyone with questions concerning sales tax on the sale of a factory-built home can call the toll-free number in Tallahassee (1-800-352-3671) or the state Department of Revenue office in your area, or your county tax collector's office.

Send comments or questions to Len Bonifield at elb@gate.net or write him at 2914 Dollar Bonnet Lane, Lakeland, FL 33810. Please include your e-mail and mailing address. Because of the volume of mail, he can't respond personally to every query. Bonifield is a manufactured-home resident and a past HOA president and former officer of the FMO District 1 board of directors.

[Last modified October 12, 2006, 13:18:57]