Carpet Stewardship Assessment AB 2398
Effective July 1, 2011, under Assembly Bill 2398, it is
mandated by the State of California to charge a $.05 per yard fee on all carpets being sold.
Below is a list of best practices and recommendations for creating an invoice with the CARE Stewardship Assessment for California.
· The Stewardship assessment will always be calculated based on a square yard (SY) total at the current assessment amount. The SY total shall be rounded to 3 decimal points.
· If the product is invoiced in a unit of measure other than SY the product total will be converted to SY before calculating the assessment.
· To convert Square Meters (SM) to SY, multiply 1.1959 by SM quantity.
· To convert Square Feet (SF) to SY, divide SF quantity by 9.
· The Stewardship assessment will be rounded by half adjusting, to the nearest penny.
o Ex.$4.564=$4.56
o Ex.$4.565=$4.57
· The Stewardship assessment is not taxable and will be excluded from tax calculations.
· The Stewardship assessment shall be totaled on the face of the invoice.
· System limitations may result in formatting variations of the invoice including, but not limited to placement of the stewardship assessment associated with each detail line.
· The description associated with the assessment has been agreed upon by the CARE implementation committee to be the ‘California Carpet Stewardship Assessment’.
Record Retention Requirements for Retailers AB 2398
Retailers must retain the following records for sales of carpet in California, for a period of three fiscal years:
· Manufacturer of the Carpet
· Date(s)the Retailer Ordered or Purchased the carpet from the Manufacturer
· Date(s) the Retailer Sold or Offered the carpet for promotional purposes
· Retailer Invoice(s) or functionally equivalent billing documents showing
California Carpet Stewardship Assessment
· Certification Letter(s) from the department if provided by a manufacturer to demonstrate that carpet from the manufacturer is or was subject to a department-approved stewardship plan.
- Important Note: Although the flooring dealer is required to collect the Stewardship Assessment Fee from the end user, the dealer is not required to remit the collected fee to the state. All carpet manufacturers and distributors are required to charge the flooring dealer the assessment fee when the materials are purchased, and they are required to remit the fee to the State of California. The fee that the dealer collects from the end user is simply a reimbursement to the dealer for the fee they paid when the carpet was purchased.
- Recommended procedures for collecting the Assessment Fee in JobRunner and FloorManager
- Pacific Solutions recommends that you create a Non-Inventory, Non-Taxable Material item called “California Carpet Stewardship Assessment Fee”. See details below.
Step 1: Go to the
Product Catalog, and create a new item.
Choose “Unclassified” as the product type. Or create your own classification for this process.
Step 2: Type N/A into
the Manufacturer field, and leave the vendor blank. Choose SY as the unit of measure unless you
sell carpet by Square Foot. In that
case, choose SF. Type "California
Stewardship Assessment Fee" into the Style Name field, and Type
"Non-Taxable" into the Color Field.
On the Entry Tab shown below, please check “Disable Discount”, “No
Inventory Required” (Which will prevent a purchase order from being created), and
“Non-Taxed”
Step 3: The next step
is to enter pricing. In the example
below we have entered .05 as the cost and .05 as the sell price per SY. If you sell by the Square Foot, you will need
to enter .00556 as the unit price, which will equate to .05 per Square
Yard. Be sure to enter the per unit rate
on both the Line ID and the Color line.
Step 4: On the Sales
Agreement example below, you will see that Product ID 14206 was assigned to the
California Carpet Assessment Fee when the item was created in the product
catalog. When the order was written into
the system, you will need to subtotal the Square Yardage or Square Footage
outside the system and enter a line with the summarized yardage on one line as
shown below. Since we checked the
No-Inventory checkbox when the product was created, there is no Red X on the
line, which means the system will not create a purchase order or require cost
verification on this line. Additionally, the item is not part of the tax calculation when the invoice is supply only.
Although it does not appear to be a current requirement under Assembly Bill 2398, you will be able to run reports on the collected Assessment Fee by running a Product Sold by Product ID Code report.
If you have any questions, please contact Pacific Solutions Technical Support at 800 201 6509 and support@pacific-solutions.com .