§ 44-1-6. Additional collection powers — Nonresident contractors.
(a) Any person doing business with a nonresident contractor shall withhold payment of
an amount of three percent (3%) of the contract price until thirty (30) days after
the contractor has completed the contract and has requested the tax administrator,
in writing, to audit the records for the particular project, a receipted copy of the
request to be furnished to the person holding the funds. The tax administrator shall,
within thirty (30) days after receipt of the request, furnish to the nonresident contractor
and to the person holding the funds either a certificate of no tax du
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§ 44-1-6. Additional collection powers — Nonresident contractors.
(a) Any person doing business with a nonresident contractor shall withhold payment of
an amount of three percent (3%) of the contract price until thirty (30) days after
the contractor has completed the contract and has requested the tax administrator,
in writing, to audit the records for the particular project, a receipted copy of the
request to be furnished to the person holding the funds. The tax administrator shall,
within thirty (30) days after receipt of the request, furnish to the nonresident contractor
and to the person holding the funds either a certificate of no tax due or a certificate
of sales and use tax or income tax withheld, or both, due from the nonresident contractor.
(b) Upon receipt of a certificate of no tax due, the person holding the payment may pay
the nonresident contractor. Upon receipt of a certificate of taxes due, the person
may pay to the contractor out of the amount withheld the excess over the amount of
taxes stated in the certificate together with the interest and penalties assessed.
If the tax administrator furnishes neither certificate to both parties within thirty
(30) days after receipt of a written request for the making of the audit, the person
holding the payment may immediately pay the payment withheld to the nonresident contractor
under the terms of the contract free from any claims of the tax administrator against
either the person holding the payment or the nonresident contractor for payment of
sales or use taxes or income taxes withheld, or both.
(c) In the event the tax administrator serves upon the contractor and the person holding
the payment a certificate showing the taxes due within a thirty (30) day period, the
person holding the payment shall deposit with the tax administrator the amount stated
in the certificate which is not in excess of three percent (3%) of the contract price,
taking a receipt for the amount, and is free from any claim of the nonresident contractor
for that amount or of the tax administrator for sales and use taxes or income taxes
withheld, or both, arising out of the materials, equipment, and services used in performance
of the contract of the nonresident contractor on that project.
(d) As used in this section, "a nonresident contractor� is one who does not maintain a
regular place of business in this state. "A regular place of business� means and includes
any bona fide office (other than a statutory office), factory, warehouse, or other
space in this state at which the taxpayer is doing business in its own name in a regular
and systematic manner, and which is continuously maintained, occupied, and used by
the taxpayer in carrying on its business through its regular employees regularly in
attendance. A temporary office at the site of construction shall not constitute a
regular place of business.