Memorandum
September 9, 2003
To: County Treasurers and Staff
From: Mathew Moser, Manager
Peggy Stalcup, Assistant Manager
Subject: Questions and answers from May KCTA meeting______
We received many good questions at the spring KCTA meeting and we would like to take this opportunity to respond to those inquiries. I will document those questions and immediately underneath the question, we will respond with the answer.
SALES TAX ISSUES
· When will the VIPs system programming be completed that will allow the entry of the entire sales tax exemption number?
Answer: We will create an incident on our Information Systems data base that will be prioritized and approved by the change control committee. Some examples of high priority work are legislation or problems that prohibit further work on the system. Problems that have any kind of work around method will be prioritized at a lower level.
· Until the programming has been completed, how will the counties enter the sales tax exemption numbers?
Answer: If you remove the first four numbers, you will be able to use the vips system to collect the number. The 1st three numbers are the tax type and the last three number indicate which account to apply the tax.
· What are the counties expected to do when a customer presents one of the old sales tax exemption numbers?
Answer: You are not to accept the old number. Everyone who has a current account has been issued one of the new numbers. Tell your customer, you will not accept the old number and a valid number will have to be provided when titling/registering the vehicle.
· What methods exist to check a company’s compliance when submitting payments?
Answer: At this time there are no checks and balances.
· Do methods exist to match vehicles registered with incoming payments?
Answer: Not at this time.
· What format are leased companies required to use when submitting payments on leased vehicles?
Answer: This question has been submitted to the Sales Tax Division for a response.
· What is the correct way to enter exemptions on leased vehicles coming from out of state?
Answer: All companies doing business in Kansas must have a sales tax registration number. If they do not have a Kansas assigned number, the customer must be sent back to the leasing company or you may call the sales tax division for further information. Their telephone number is 877-526-7738 toll free if outside of Topeka. If the caller is from Shawnee County(inside Topeka), the number is 368-8222.
· Should they be giving us a Kansas exempt number to record in VIPs under exempt reason 2 or is it appropriate to record the exemption under reason 3 which is out of state?
Answer: You should use exemption reason number 2 which reads Purchased for rental or lease.
· How are payments tracked when the lease originated in another state and then was transferred to Kansas?
Answer: This question has been submitted to the sales tax division for a response.
· In what circumstance would the number 1 exemption from sales tax be used? It reads “Purchased from a retailer not in possession of form STD8.”
Answer: An example would be a small trailer weighing under 2,000 sold by wal-mart or another type of retailer which does not fall under the dealer licensing act and is not licensed by the State of Kansas to sell vehicles.
· Why is the number 2 exemption reason called an exemption, when in reality it is a delayed collection?
Answer: One screen is used for all non-collection of sales tax. When the VIPs system was created, the decision was made to call it the exemption reason screen. It would be possible to change the wording to non-collectible sales tax transaction codes.
· Is number 7 exemption reason a delayed collection rather than a true “exemption”?
Answer: Same as above.
· When will the VIPs system programming be completed so the totals carried forward from the daily report to the monthly reports will balance and reflect the true amounts collected on the receipts?
Answer: This has been completed and downloaded to all county Treasurers offices.
· Will the data on the sales tax reports on VIPs be presented and displayed in the same format on all three reports?
Answer: Yes, the plan is that all three reports will have the same look and feel.
· When will the adjustments on voids or collection correction be reflected on all three monthly reports?
Answer: Currently the adjustments are be identified by the transaction type code of I (isolated) C (compensating) and P (resident).
· Why doesn’t the 50 cent collection fee show up on daily reports for every transaction? Some collection fees are dropping off the reports?
Answer: The Correction has been made and the reports are now reporting the 50 cent collection correctly.
· Why doesn’t the sales tax receipt display both the sellers and buyers address. rates and amount of tax collected for both jurisdictions?
Answer: Currently there is no room on the receipt to display both addresses or detailed charge information, however, the receipt format is being re-evaluated. An incident will be created on our change control data base to modify the receipt to display all pertinent information. The incident will be prioritized by the change control committee.
· Can you explain the current jurisdiction codes and provide a break down of city/county codes?
Answer: If the county has both a city and county tax the jurisdiction code looks like this: HIGDP 6.3 This means that Highland in Doniphan county has a combined rate of 6.3 The first three letters of the city name are used and the situs for Doniphan County. If there isn’t any city tax, the jurisdiction code looks like this: WYACO. This means there is no city tax, and the code means Wyandotte County tax only. You use the first three letters of the county name and CO stands for county.
· How are you going to resolve the problems surrounding rural addresses in multiple counties?
Answer: A memo has been prepared outlining the new procedures for inputting rural addresses.
ELIEN AND PAPERLESS TITLES
· What are the procedures on duplicate-reissue E-Titles?
Answer If a paper title was issued prior to January 1, 2003 with a recorded lien and the title has been lost, a duplicate title cannot be issued. If the customer needs a title, they must provide a lien release. When the customer brings in the notarized lien release, you will complete and collect $10.00 for a re-issue title which can be found on your title menu.
If the title is being held electronically as an e-title record, a duplicate title cannot be issued and a lien release would be required. When the customer brings in the notarized lien release, you will complete a lien release application on the new lien release menu option on the VIPs system. We will provide further details on the new lien release option in a separate memorandum. The lien release menu option will create the issuance of a Kansas title immediately upon receipt of the application providing all of the data matches the e-lien title record.
· Would like to see if an e-title has been issued after lien release faxed to state. Dealers or lien holders are calling to check on status and we cannot check on it.
Answer: To complete an inquiry on a lien release, please go to your inquiry menu option and select WIP. Using the vehicle identification number you can inquire on the wip file and look for a lien release (RLZZZZ) application. If the title has been issued, a valid title number will be inserted into the title number field. If the title has not been issued, the title number field will be blank. If the record is not on the wip file, check the current inquiry file to see if the vehicle title status still says etitle.
· Faxed lien releases getting lost or taking several days to issue title. Requires time and phone call expense to research the situation. What are you doing to resolve this problem?
Answer: The counties will shortly be receiving a download which will include the new menu option of “Lien Release.” If the title record is being held as an etitle, the counties will be able to process the lien release for their customers. If the lien release matches the title record, a paper title will be printed upon receipt of the lien release application. We have experienced some errors occurring on the lien releases being faxed that are resulting in the delay of the issuance of the title. They are listed below:
Lien releases on paper titles. Releases can only be accepted on etitle records.
Lien releases are not notarized.
Lien releases have missing or incomplete vehicle, owner information.
Title applications are setting at “RP” or have correspondence attached and the title cannot be issued.
· Can owner fax lien releases to the state themselves?
Answer: Yes. The lien release will be processed if the title record is an etitle record and the lien release has been signed and notarized.
· Receipts are not marked for identification as an e-title record. Dealerships are accepting receipts to proceed when a re-issue or duplicate title application is needed because a paper title has been issued with a lien on it.
Answer: Programming and testing is underway to place ETITLE on the receipt on all types of registrations when the title is being held electronically. We anticipate that you may have those changes sometime in the mid part of September.
TITLING OF VEHICLES
· How do we prevent title jumping?
Answer: Check the title re-assignment area on the back of the Kansas title. Only licensed dealers can re-assign on title assignments. Individuals must title and tag the vehicle and cannot re-assign. Disclaimers can be accepted from individuals only if the following conditions are met.
· The dealer has accepted the vehicle back from the assigned owner within 30 days of the delivery of the vehicle.
· One of the owners of the vehicle is going to remain on the title. The assignment of title must have been completed at the same time for all multiple owners. If there is a lienholder on the vehicle, they must complete an affadavit allowing the co-owner(s) to drop off the assignment.
· What are the procedures for preventing the issuance of a 2nd 30 day tag?
Answer The issuance of 30 day permits by the county are on the VIPs system. 30 day permits issued by dealers are not entered onto the VIPs system. Consequently, we cannot monitor the issuance of additional permits. However, if originally issued by a dealer some ways to prevent issuance of a second 30 day permit would be to ensure that you review the TR-39A (Sellers Notification of Sale) if a title is not available. Upon reviewing check the date of sale very carefully and do not allow issuance of a 30 day permit if the delivery date if over the 30 day time frame. If you are issuing a replacement 30 day permit because the original was lost, stolen or destroyed, require a police report or the remains of the destroyed permit. The issuance date on the replacement will be the same as the original and they must relinquish all receipts from the original transaction.
· What can the County/State do to prevent the lost property tax and/or registration when the date on the back of the title is the delivery date of the title and not the delivery date of the vehicle?
Answer: Use the date on the sales tax receipt provided by the dealer or the bill of sale if the transaction is between individuals.
· Amateur radio and disabled fees on transfers are not correct. When are these programming changes going to be completed?
Answer: When the sales tax receipts/report problems have been resolved and the e-lien project enhancements have been completed, this will be one of the incidents that will be moved up on the priority list on change control.
· Should clerks at county offices write in date of sale when date can be verified from other documents?
Answer: No, take the date of accompanying documentation. The Kansas title is being modified with a purchase date field in the assignment area. At that time, the date of sale will be required on the back of the title. County clerks should never add any information to a title.
· Registration receipt instructions taken by dealership when vehicle trade ins are confusing. Will you re-interate the instructions given to dealers?
Answer: We will send the dealers information re-interating instructions when a title is being held electronically by the Division of Vehicles.
· Burden on the customer to obtain a copy of the registration if the new application is being completed in another county and the vips record has gone to history. What can be done to streamline these transactions?
Answer: The county could provide them a copy of the original registration and charge them a duplicate registration charge of $.50.
REFUNDS
· Why aren’t refunds removing the plate record from the current master file?
Answer: Plate records are inactivated by refund transactions ten working days after the record is received by the Division of Vehicles and the plate record is then moved to the history master file. If there is an error on the record, it will remain on the WIP file until the problem is resolved.
· Can a seller apply for a refund when the title has not been signed over or issued?