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Idaho family's pumpkin stand cited by tax officials for permit, sales tax violations

I've been holding off on blogging about this to see what the ultimate outcome might be. However, since the tax wheels are grinding slowly in Idaho and prime pumpkin season will soon be over, here goes.

Taryn Fordyce, 7, of Brighton, Colorado carries a large pumpkin back to her family's car at the Rock Creek pumpkin patch in Broomfield, Colorado on October 23, 2010.  The Rock Creek pumpkin farm offers over 100 acres of U-pick-em pumpkins that attracts over ten thousand visitors each weekend day prior to Halloween.  UPI/Gary C. Caskey Photo via Newscom

By now you've probably heard of the situation in Lewiston, Idaho, where a family decided to make a few extra bucks this fall by selling pumpkins from their front yard. The parents, being good marketers, put their two young, tow-headed kids out front to handle the transactions.

Dan Charais told the Lewiston Tribune that he thought it would be a great way for his 6-year-old son Jacob and 4-year-old daughter Sami-Lou to learn entrepreneurship and raise money for school sports.

Well, the kids, as well and Dan and his wife Kami, all got a lesson. Just not the one they planned.

The price of doing business: An Idaho Tax Commission representative last week informed the Charais family that all sellers must obtain proper permits in order to do business in the state.

And part of doing business is charging customers sales tax and then sending that tax money along to Idaho tax officials.

Suddenly the news and blog worlds were abuzz with "evil state revenuers shut down kids' pumpkin patch."

Not to be the cranky old fart who yells "get off my lawn" at kids (although I admit I've done that a time or two), but I'm siding with Idaho tax officials here.

OK, maybe the tax commission compliance officer Patrica Gilmore was, by some reports, a bit brusque in her violation notification. The commission is looking into the specifics and, if it determines action is warranted, could discipline her.

But from the various news reports, it appears that she simply was doing her job, trying to enforce Idaho's tax laws.

Tax commission staff in all states routinely check to make sure fruit stands, farmers' markets and the like are properly permitted for selling the items and remitting the appropriate sales tax.

Not a childish operation: Despite the national public outrage, the Charais situation wasn't the kids growing a handful of pumpkins in their backyard and then selling them for a few cents in a autumnal turn on the traditional lemonade stand.

Rather, the family made a deal with an area pumpkin stand, under which the owner of that operation agreed to split the money raised if the kids peddled the pumpkins from their front porch.

Sounds like a business to me. And I'll guarantee that it was the adults, not the eventual young sales team, that made the deal.

And if there is no age or sales amount exemption in Idaho tax law, then the kids -- or more appropriately their parents who brokered the deal -- need to follow the law.

As the publicity grew and the tax commission held its ground, the pumpkin supplier reportedly offered to take care of the sales tax payment on the gourds the kids sold.

And, according to comments left at various websites by Lewiston locals, the kids are still in business. Which seems to support the Tax Commission's statement that its goal wasn't to shut the kids' sales down, but to get the family to follow the law.

Learning the proper lessons: Again, I refer to that word: Business.

The lesson the kids need to learn is that everyone needs to follow the laws, tax and otherwise, that apply to any business operation.

In some states, some garage sales are deemed businesses and required to get permits and pay sales taxes. Texas used to be strict in this regard, but has loosened up a bit of late, maybe because in this economy more people are looking to make needed money that way.

And even the aforementioned iconic lemonade stand face rules in some places.

In August, a Portland, Ore., girl's lemonade stand was shut down, at least temporarily, by by-the-book county food inspectors. Apologies were subsequently issued and the rules there were bent to allow for the stand's continued operation.

But in the Idaho case, it looks to be a case of grown-ups trying to get away with not following the rules. That's not the kind of lesson kids need to be learning.

Neither is the follow-up lesson: If you don't like a rule, just complain loudly and use knee-jerk public opinion to pressure authorities to give you your way.

Folks complain all the time about special government deals <<cough, bank bailouts, cough, cough>> given to others, usually meaning favors for someone they don't know or who doesn't share their point of view.

So why are they all bent out of shape when a government official tries to make sure the tax laws apply to everyone equally? Being young and cute isn't grounds for tax avoidance.

As for the kids, I'm sorry they had to go through this -- although subsequent reports reveal that the tax commission official didn't confront the youngsters; they were in school when she told their parents about the laws that were being broken and, as mentioned, the porch sales continued -- but it is indeed a teaching opportunity.

I just wish the parents were teaching their children the appropriate lessons.

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As a freelancer charged with collecting state sales taxes, it has been my experience that the people I encounter who protest the loudest about paying or collecting taxes usually are taking cash under the table. I am glad I ran across your post. Most sensible thing I have read on the subject.


I agree with you in principle on following the law.

The flip side here though is that too much regulation both chokes useful activities and reduces respect for the law. I would imagine the law in Texas was loosened because it was simply ignored.

So my question here is just how much revenue where the kids generating?

If we're talking a few hundred a month, then yes, let's get them in compliance.

However, if we're talking $200 over the course of a season, I cannot imagine a bigger waste of time for a tax collector. Tax collection needs to focus on dollar return per hour of collector. Going after a 4 and 6 year might result in $50? for the state while tracking down even 1 retail store out of compliance might net thousands.

Anyway, I think a reasonable dollar exemption for sales tax collection would have prevented a whole lot of problems. Plus it would be age blind and maybe encourage some small scale economies.


I agree with your analysis, very well put.

Too many businesses operate thinking that they are "just little lemonade stands" and don't need to follow the rules.

The law is the law. I'm all for changes, but not voluntary exemptions.

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