North Carolina has a use tax on purchases made outside the State for use in North Carolina. Residents are responsible for paying the use tax on purchases for which no North Carolina sales or use tax has been charged. The use tax applies to transactions that would be subject to sales tax if the purchase were made in North Carolina. The use tax rate is the same as the sales tax rate that would apply to the purchase if it were made in North Carolina.

In the past, individuals who purchased consumer items had to complete Form E-554, Consumer Use Tax Return, to report and pay their use tax on these items. Beginning with the 1999 tax year, individuals who are required to file an Individual Income Tax Return must report and pay the use tax on those returns. Individuals who are not required to file an Individual Income Tax Return should continue to report and pay the use tax on Form E-554. Businesses must register and file Form E-500, Sales and Use Tax Return, to report and remit use tax due on items purchased for use in their business.

See Frequently Asked Questions About Use Tax for more information.

Last modified on: 10/31/07 03:58:41 PM.