Sevierville, TN asked in Tax Law, Business Law and Juvenile Law for Tennessee

Q: Is it legal for the city to open a hospitality tax account for a 12 year old's small business?

We asked the county clerks office if my son needed a tax license and they told us he was under 18 so to go enjoy his business and learn as there was no need to file anything at his age. He was not able to legally open an account. Later he set up at an event in city limits. I was sent an email stating that they had opened a tax account for his business and he would be required to collect and file hospitality tax. I informed them of his age and what we were told at the clerks office. They are still requiring him to pay in this account that THEY opened. Honestly, its only a few dollars probably but the point is - a tourist city making millions each year is spending time harassing a 12 year olds lemonade stand. I plan on paying this to make it go away but I'd really like to know the laws regarding this matter. My research has resulted in very little information so far.

1 Lawyer Answer
James L. Arrasmith
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  • Criminal Law Lawyer
  • Sacramento, CA

A: The legality of a city opening a hospitality tax account for a minor's business depends on local laws and regulations, which can vary widely. While minors generally have limited legal capacity to enter into contracts or be held responsible for tax obligations, local jurisdictions may have specific ordinances requiring all businesses, regardless of the owner's age, to comply with tax laws, including the collection and remittance of hospitality taxes for businesses operating within their limits.

It's essential to consult the specific city ordinances or regulations that might apply to small businesses, including those run by minors, to understand your son's obligations. The discrepancy between what was advised by the county clerk's office and the city's actions suggests a need for clarification from both offices. It may also be helpful to request a written explanation from the city detailing the legal basis for their actions, including any relevant laws or policies.

Since the situation involves complex legal and regulatory issues, consulting with a legal professional who specializes in tax law or small business regulations within your locality might offer the most accurate advice. They can help you navigate the legal requirements and determine the best course of action to resolve the situation, ensuring that your son's business complies with local laws without being unduly burdened.

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