Does anyone actually keep records of their out of state purchases for tax filing?

But how would they even know? Like if I bought a laptop in Oregon (no sales tax) and brought it back to Washington, would the state somehow find out? Seems impossible to enforce.

There's limited ability for states to track small everyday purchases, which is why compliance is generally low. Most states don't have the resources to audit individuals for small use tax amounts. For larger purchases, there can be ways they discover it - especially for vehicles, boats, or items that require registration. Some online retailers now automatically collect the proper state tax, and states do share information in certain circumstances. Also, if you're audited for other reasons, use tax compliance might be reviewed as part of that process.

Does it work with most banks? My bank's export format is super weird and most tools can't read it properly.

Sounds cool but how does it know which purchases were made out of state? My credit card statement doesn't always show the location clearly.

It works with pretty much all major banks and credit cards. I used it with Chase, AmEx, and even my local credit union without issues. The system is pretty flexible with import formats. As for identifying out-of-state purchases, it uses the merchant information and transaction data to determine location. It's surprisingly accurate - it correctly identified all my Vegas purchases even when the statement just showed the business name. For anything it's unsure about, it flags it for your review so you can confirm. It also lets you set your home state so it knows what counts as "out of state" for you.

How does that even work? They just wait on hold for you? Seems too good to be true tbh.

Right, because I want to pay money just to talk to a tax department that should be available to citizens anyway. Hard pass. Just estimate your use tax and move on with your life.

It's actually pretty straightforward - they use an automated system that holds your place in the phone queue and calls you when a human agent is about to answer. You don't pay to talk to the tax department - you're just paying to avoid the ridiculous hold times. And yes, I agree these departments should be better staffed and more accessible. But the reality is they're not, and I wasted hours trying to get through on my own. For me, it was worth it to finally get a definitive answer about my specific situation rather than guessing and potentially getting it wrong.

This is terrible advice. Just because you haven't been caught doesn't mean it's legal to ignore use tax requirements. States are getting more aggressive about enforcement.

I'm not advising anyone to break the law, just sharing my personal experience. And you're right that technically we should report everything. But if you look at the compliance rates for use tax, it's extremely low nationwide. Most states have bigger fish to fry than auditing individuals over small purchases. That said, everyone should make their own informed decision about compliance based on their risk tolerance and personal ethics.

This is super helpful to know! Do you happen to know where I can find this table? Is it just on the Colorado tax form somewhere?

It should be in the instructions for Form DR 0104US (Consumer Use Tax Reporting Schedule). You can find it on the Colorado Department of Revenue website. I think most people with normal shopping habits are better off using the table instead of tracking every single out-of-state purchase. For 2024, I believe it's going to be around 0.1% of your adjusted gross income, but double-check the current table when you file. It's pretty reasonable and saves you from the headache of detailed tracking.

This is really helpful! I had no idea about the $1,000 threshold for separate calculation. I actually did buy a new laptop in Nevada last year for about $1,200 since they don't have sales tax there. Sounds like I should calculate the actual use tax on that purchase rather than just relying on the lookup table. Thanks for the tip about separating out the larger purchases - this makes the whole process seem much more manageable!