Guest post by Rachel from Frugal and Simple
When we were married, almost all of the furniture in our first apartment with was second hand. And after five years of marriage, our home is still furnished with those same cast-offs!
The couch that my husband brought into our marriage is a nice black leather sectional that is comfortable and still has many years of wear left. We have been talking about purchasing coordinating chairs for a few years now; however all the new chairs we liked and agreed on were way too expensive.
We scoured Craigslist and thrift stores for many months without any success. Again, the things we liked were way too expensive and the ones we could afford were way too dated!
Since we had recently started hosting a small group in our home and we had some excess money in our savings account, we decided to go ahead and use this money to purchase living room chairs. We agreed on budget of $600 for purchasing chairs and we started seriously looking.
One weekend, not long after we sat the dollar amount, we stopped in a small furniture store just two miles from our home. At the front of the store there was a red leather chair with a price of $229! We both loved the chair but red didn’t go with the existing decor in our living room.
We inquired and learned that particular chair did not come in black, which was the color we preferred, but that we could order similar chairs made by the same manufacturer for the price of $229! This was by far the best price we found for chairs that we liked. Also, by paying cash, we didn’t have to pay sales tax!
We ended up paying $458 cash for our two new black chairs. With the $142 we were under budget, we purchased an apple green leather ottoman for $104 so we could kick up our feet and have an additional seat for times when we have a house full of friends.
We now have two chairs that we needed and an ottoman–and we’re $38 under budget!
Rachel loves living a frugal and simple life with her husband and toddler and new baby. She blogs about saving money, contentment, and living minimally at Frugal and Simple.
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So nice to find a good deal AND the item you are looking for!
I love those chairs! Even though you got a great deal, they look very expensive.
I think that’s a really good price, and I love those chairs.
Just goes to show that asking questions can get you far!
Kind of reminds me of how I bought my 80.00 wedding dress (a bridesmaid dress that happened to also come in white and ivory…)!
Like the chairs. But I Love the cow hide rug in front of it! That is my next buy for our living room, I keep my eyes out for a good buy on one of those!
loving the look!
http://etsystalkers.com
Cute chairs! Nice price.
beautiful chairs!
Cute chairs! Great job 🙂
Okay then. Nice chairs, good job. The color of the ottoman is my new fave. I would like to do my kitchen that color. Thanks for sharing.
I love the color of the ottoman too!! Our living room is accented with that apple-y green color!
Is it legal to avoid sales tax by paying cash?
I should add, if a store doesn’t charge you sales tax, that doesn’t mean you’re not obligated to pay it. You are supposed to declare purchase that you didn’t pay sales tax on but that are sales tax eligible on your returns. (This includes online purchases too.) It’s called use tax.
All the retailer did was discount the price of the chairs a bit to make it seem like they weren’t paying sales tax. It was just a discount. The retailer will still pay that sales tax, they just took that amount out of their cost. Retailers always prefer cash, because credit card companies charge high percentages everytime a customer swipes their credit card. So, for the retailer, it probably evened out.
Ah, that makes more sense!
Maybe it was a discount, but then why didn’t they just call it a discount? If it was a small store, they could also be pocketing the cash and keeping it off the books. I’m not saying that’s right, but it’s not unlikely either.
Basically it was just a discount that was the amount of the sales tax. A lot of times when you pay cash for things, retailers will discount the amount of sales tax. They still pay their sales tax but then they don’t have to deal with credit/debt card processing fees!
Applauding your story; I’m all for it, and as a personal finance author/coach / spokeswoman myself, have enormous respect for your ability to save and your discipline to hold off immediate gratification and put a bit of patience and homework into your purchase. Awesomeness.
You wrote, “Also, by paying cash, we didn’t have to pay sales tax!”
May I kindly point out: You may be aware that by paying cash there is a possibility (if not likelihood) that you are enabling the proprietor to illegally bypass their responsibility to report the income on the sale they made to you. It is their legal responsibility to collect, report and pay sales tax to their local municipality (city, county, state) on all sales. They may have “incentive-ized” you with a lower price so they could accept the cash and not report the sale and thus not pay income tax on their profit. Cash does not leave the audit trail that credit cards and checks do.
Just a kindly “beware” to know, when you are offered a deal where you don’t pay tax when paying in cash.
Such an illegal tax-avoidence may not have happened at all. Perhaps the store owner really did document the sale, and will pay the sales tax out of the discounted sale price. And report the income to their business. It may simply be an innocent pricing strategy; just another way to offer a “sale” or “discount;” maybe they are reporting and paying taxes in full.
Please don’t be offended. Just a thought of which to be aware, as I know our fabulous and fearless blogger Crystal Paine to be a woman of upright, moral, and legal business character! And she’d be all for keeping her listening / reading audience on the up and up.