The Board of Indirect Revenue Determinations (BIRD) recently ruled that giving leftover turkey to others to eat is a separate, identifiable, and taxable waste removal service.
Paul Gobble, a taxpayer subject to BIRD jurisdiction, was surprised to receive a use tax assessment following Thanksgiving. "The assessment just flew in," commented Mr. Gobble. "My family and I were eating pizza and had forgotten all about the holiday leftovers. We had eaten so much just days before. We thought we were done with the holiday leftovers. Wow. We were really disappointed to get BIRD's use tax assessment. It really ruffled my feathers."
Days before Thanksgiving, Mr. Gobble purchased two turkeys for a holiday dinner at his house. Sales tax was validly paid on the poultry.
Following his holiday feast, Mr. Gobble gave two friends, Stu Fing and Grandma "Gran" Berrisawse, his leftover turkey. "It was just a gift. I already paid tax on my turkey. I don't get it," Mr. Gobble explained.
BIRD determined that Mr. Fing and Ms. Berrisawse had performed a taxable waste removal service. Mr. Gobble received the benefit of this taxable service. BIRD reasoned that a separate and identifiable taxable transaction occurred. Mr. Gobble finished eating his turkey and then he later, in a separate transaction, transferred the possession of valuable property (the leftover turkey) in exchange for a taxable waste removal service. According to BIRD, purchasers like Mr. Gobble are responsible for paying sales tax or remitting use tax on purchases of taxable services.
Since neither Fing nor Berrisawse collected sales tax on the value of the taxable waste removal service, Mr. Gobble was liable. "I think this whole thing is cuckoo," exclaimed Mr. Gobble. I've never heard a word of something like this from BIRD. Who sends out use tax assessments on leftover turkey? What is the value of that anyway? I already paid tax when I bought the turkey. This is for the birds!"
A representative from BIRD refused to comment.
En re Gobble, 434 BIRD 26 (2014).
This is a Holiday Humor Piece From TTR, Inc.