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Consumers are always on the lookout for a good deal, and that is no less true of those who smoke. With many name brands now retailing in excess of $7 per pack, the lure of "tax free cigarettes" advertised on line or in print publications may be too much to resist.

But be advised that there is no such thing as "tax free cigarettes." Indeed, those very same internet or print ads for cheap smokes will carry fine print stating that the jurisdiction in which a taxpayer lives may tax these purchases, and that is certainly the case in Massachusetts, which levies a tax of $2.51 per pack of 20 cigarettes.

The fact is that all internet and mail order cigarette sellers are required under federal law (the Jenkins Act) to report the purchase, name and address to Massachusetts and other states. While not all such sales are reported to Massachusetts, many are. Once informed, the Department of Revenue will send a Notice of Intention to Assess, followed by a tax bill that adds penalties and interest to the tax bill.

Since 2003, as a result of such cigarette sales notifications from retailers, Massachusetts has collected about $9.364 million in tax, penalties and interest from individuals who did not pay the cigarette tax at the time of purchase.

To avoid penalties and interest file and pay the cigarette sales tax using Form CT-11 (for tax owed prior to July 1, 2008) or Form CT-11B  (for tax owed after July 1, 2008).

Most deals that sound too good to be true aren't, and that's the case with "tax free cigarettes" as well.

If you have questions or comments, contact the Dennis Buckley, Taxpayer Advocate.

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