What reconciliation options are available for permits issued on or after July 1, 2010?
Permits issued on or after July 1, 2010 are required to reconcile when the final contract price or total project cost is $20,000 or more. Two Construction Use Tax reconciliation methods, as described below, are available to contractors doing work for a contracted price – The 48/52 Short Method and the Actual Method. When homeowners pull a permit to work on their own home and there is no contract price, the actual method is required. In both methods, the total taxable cost of construction must be determined. Once the total taxable cost is determined, the city and county combined tax rate of 4.06% is applied to determine total tax due. Then, this amount is compared to the total city and county tax paid on the permit to determine if there was an under or over payment of taxes. Total taxable cost of construction is determined as follows: 1) The Short Method is a simplified project reconciliation available when there is a final contract price. The final contract price, including all change
