Sales tax blues

Sounds like it would have been much simpler to charge sales tax based on where it's shipped from rather than where it's shipped to.

 

Google Express seems to charge a estimated tax rate when placing an order, and then refunds some of the tax when they ship and adjust the rate accordingly (food, clothes items, counties, etc are charged differently in different places)

 

The potential problem on that is I'm in Long Beach and our tax is 10.25%. Brea is in Orange County and not very far down the road and their tax rate is 7.75%. I'm at a disadvantage servicing customers if I had to charge my tax rate and we both deliver goods to the same place or provide service at the customer facility.

 

The sales tax rules are ridiculous.


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Shoot Jimmy a PM if we don't have what you need on the site. If the parts are available from any of the distributors we can get you dialed in. - Van

 

Sales tax for online sales is a complicated subject that has absorbed a ton of my time over the past couple of months. From state to state the nexus criteria differs and then there is the Streamlined Sales Tax program that has 24 of the states participating currently. It won't be long before all internet sales are subject to sales tax. - Van

 

Yeah, well except that tax burden is always on the buyer.

 

Even when it wasn't collected by the business you ordered from, you are still supposed to claim it and pay it when you file your income tax in most states.

Yes, I am aware that most people don't report this and are therefore guilty of tax evasion. Almost none of them will be caught unless they are guilty of some other financial crime or tax evasion.

 

so then if say STG does business in 40 states, and collects taxes for 40 states, they have to then submit sales tax to those 40 states? I know in NYS you had to submit collected taxes quarterly. This would be a small business nightmare

 

Yup, already seeing it with some stuff I purchase online. Used to be a member with Sportsmans Guide because they regularly offer free shipping on orders over $49 or $79. Pretty much always purchased ammo from 'em for that free shipping and no tax. Towards end of last year, they quit doing the free shipping on ammo. Didn't think much of it until I loaded up my cart with some stuff and noticed they were now charging me tax. Empty cart, made note to not renew membership this year, go to Walmart and purchase same ammo for a couple $ more. Also noticed I get charged tax on most of the things I get from Amazon now.

 

Yep. My company is in Georgia and I file returns in all states that collect sales tax because we meet the criteria in all those states that requires us to be registered with them.

So we have to normally pay the tax before we get paid for the tax since our payment terms for the sale of software is 30-60 days and most states require us to file monthly.


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I recently learned that many states also allow vendors to tax shipping. Most vendors I ordered from don't do this but, at least one I ordered from is doing that now.

I also recently heard of some buyers getting notified they may be on the hook for the tax of previous orders within any statue of limitations, and the vendors may be obligated to report those sales to the state.

It sure would blow to get hammered on "x" years of back sales taxes on on-line purchases...

 

They sure do. And per my State's tax code (ND) they can.

 

Depends on the state.


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Want to hear something even better? All of our software is accessed remotely. Yep - still taxed in most states.


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