If you purchased taxable items for use, storage, or consumption in North Carolina and did not pay the applicable North Carolina sales tax at the time of purchase, you may owe North Carolina use tax. Consumer use tax complements the sales tax and generally applies when sales tax was not collected by the seller.
When Might I Owe Use Tax?
You may owe North Carolina use tax if you purchased taxable items and North Carolina sales tax was not charged at the time of purchase. Common examples include purchases made:
- Online from retailers that did not collect North Carolina sales tax.
- Through mail-order catalogs.
- From television shopping networks.
- From out-of-state retailers.
- From sellers that did not charge North Carolina sales tax.
- While traveling outside North Carolina and later brought into North Carolina for use.
Although many remote sellers are required to collect North Carolina sales tax, certain purchases may still occur without tax being charged. In those situations, the purchaser is generally responsible for reporting and paying any use tax due.
What Is Use Tax?
Use tax is a tax on taxable purchases when sales tax was not collected at the time of sale. The tax is owed by the purchaser and helps ensure that taxable purchases are treated consistently regardless of where they were made.
Use tax applies to purchases used, stored, or consumed in North Carolina. What Is the Use Tax Rate?
Use tax is generally due at the same rate as the sales tax that would have applied had the item been purchased in North Carolina. The applicable rate depends on:
- The type of item purchased, and
- The county where the item is used, stored, or consumed.
Because local tax rates may differ by county, the amount of use tax due can vary from one location to another.
How Do I Calculate My Use Tax?
The North Carolina Department of Revenue provides tables and worksheets that may be used to calculate consumer use tax liability. These resources may be used whether you have:
- Complete purchase records,
- Partial purchase records, or
- Limited purchase records.
Use the consumer use tax table and worksheets contained in the 2025 D-401 Individual Income Tax Instructions to determine your use tax liability.
Examples
You may owe use tax if:
- You purchase furniture online and the seller does not collect North Carolina sales tax.
- You purchase taxable merchandise from an out-of-state retailer and bring it into North Carolina for personal use.
- You purchase taxable goods while traveling and no North Carolina sales tax is paid.
You generally would not owe additional use tax if the correct North Carolina sales tax was already collected and paid at the time of purchase.
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