What tax responsibilities does a Buildingstars franchisee have?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE shall make timely filings of all tax returns and shall pay when due all taxes levied or assessed on, and related to this Agreement and the Business.
At no time is BUILDINGSTARS required to inform FRANCHISEE of any federal, state, municipal, or local law, rule, regulation, ordinance code, or tax.
d. Taxes. FRANCHISEE is and will continue to be responsible for complying with all local, state and federal tax requirements including but not limited to income tax, sales tax, use tax or any other tax required along with the proper reporting requirements.
F. Taxes. FRANCHISEE agrees to indemnify and/or reimburse BUILDINGSTARS and its Affiliates for all capital, gross receipts, sales, and other taxes and assessments imposed by any applicable state or local governmental authority as a result of the conduct of the Business or the license of any of BUILDINGSTARS or its Affiliates' intangible property to FRANCHISEE (whether required to be paid by BUILDINGSTARS or its Affiliates, withheld by FRANCHISEE or otherwise). FRANCHISEE's obligation to indemnify or reimburse BUILDINGSTARS or its Affiliates for these taxes does not extend to income-type taxes which a state or local government imposes on BUILDINGSTARS or its Affiliates' income.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, franchisees are responsible for handling all tax requirements at the local, state, and federal levels. This includes, but isn't limited to, income tax, sales tax, use tax, and any other required taxes, along with the necessary reporting. Buildingstars is not obligated to inform franchisees of any tax laws or regulations. Franchisees must also ensure they make timely filings of all tax returns and pay all taxes related to the franchise agreement and business operations when due.
Furthermore, Buildingstars franchisees are obligated to indemnify and/or reimburse Buildingstars and its affiliates for capital, gross receipts, sales, and other taxes and assessments imposed by any applicable state or local governmental authority. This reimbursement covers taxes resulting from the franchisee's business operations or the licensing of Buildingstars's intangible property to the franchisee, regardless of whether these taxes are required to be paid by Buildingstars or its affiliates, withheld by the franchisee, or otherwise. However, this indemnification does not extend to income-type taxes imposed on Buildingstars or its affiliates' income.
In practical terms, this means a prospective Buildingstars franchisee needs to be prepared to manage all aspects of tax compliance, including understanding applicable tax laws, filing returns, and making payments. They should consult with a tax professional to ensure they meet all obligations and to understand the potential costs associated with these tax responsibilities. The franchisee should also factor in the potential for reimbursing Buildingstars for certain taxes when assessing the financial viability of the franchise.