State Sales Tax -- our own states taxes collected

[kidscakesandpartysupplies]

I totally understand the part where eBay is collecting and paying to the states the state sales taxes that our customers are required to pay, so we don't have to do anything at all for our yearly income tax reports on those states.

But what about our own state?  I have always kept track of each and every Michigan tax that I received and then I paid them to the State of Michigan. 

So how does this situation work now?  Does ebay also collect and pay those taxes to Michigan for me so that I don't have to do anything?  I'm hoping so because I did not keep track of them for 2019 and I know of no easy way to find out how many of my Michigan buyers had to pay that tax, or how much each of them paid. 

[computeraidllc]

If Michigan is one of the states eBay collects, then you don't have to pay anything in for those sales to Michigan. It would go as tax exempt or if the state has a line for marketplace facilitators or something like that, the amount sold would go there.

In New York, it would for me go under tax exempt.

[mam98031]

Michigan is a state that Ebay is collecting sales tax for as of January 1st, 2020.

So you are correct, you no longer need to be collecting sales tax on your sales within your home state.  But you still need to keep complete and accurate records on these sales.

You need to check with your state to see how you are suppose to report the sales as it differs from state to state.

For the state I'm in, we still have to claim the retail sales on our tax report, but then we are allowed a deduction for any sites such as Ebay that collected sales due to the MFLs.  

So make sure you check with your state for their requirements from you and keep good business records.

[the*dog*ate*my*tablecloth]

@kidscakesandpartysupplies 

If Michigan didn’t come online until this month you are indeed responsible for reporting and remitting 2019 state sales taxes. You should be able to get the total tax collected by running reports on PayPal.

[kidscakesandpartysupplies]

Thank you @the*dog*ate*my*tablecloth .  I suspected that I did need to do it, but needed verification.  We had personal issues this year, and we didn't properly keep track of our Michigan Taxes that came in on sales, so I was hoping it wasn't going to be a terrible job to try to find out how much tax total we received from Michigan.  So this is my bad for not being on the ball with this. 

[kidscakesandpartysupplies]

@mam98031  Thanks very much for the info and the advice. 

[lacemaker3]

---

@kidscakesandpartysupplies wrote:

...

But what about our own state?  I have always kept track of each and every Michigan tax that I received and then I paid them to the State of Michigan. 

...

---

From what you said (above), it looks as though you had a Sales Tax Table on your listings before this month, which would have collected sales tax automatically for any sales to Michigan. (Now that eBay is collecting sales tax for Michigan beginning Jan 1, 2020, that over-rides your sales tax table.)

As long as that was the case, you will be able to get a report from PayPal that shows you how much sales tax was collected. I think it will show you the delivery state in a column, and that is the state the sales tax was remitted to. If it doesn't have it's own column, it will be in the delivery address field.

All you should have to do, is find all purchases that were delivered to Michigan in 2019, and get the sales tax for those purchases. That will be what you have to remit to Michigan for your 2019 sales tax obligation to Michigan.

For 2020 and beyond, you should not need to do that again, but you will have to check if you still have a requirement to report, even if you don't have to remit any sales tax. Some states do, some don't.

[mam98031]

---

@kidscakesandpartysupplies wrote:

@mam98031  Thanks very much for the info and the advice. 

---

You are very welcome.  

I'm sorry to hear you were having some personal challenges last year.  I sincerely hope 2020 is a much better year for you.

If PP was you main source of having your payments processed for your sales, you can recover the sales that were in your state so you can pay the taxes to your state, even if you failed to charge your buyer for those taxes.  

Under reports on the PP site is a detailed transaction report you can download into a worksheet program.  It has full information on your transactions.  Much of which you won't need, but it will also give you the info you do need.  So you can sort through it and gather the information you are seeking.

Of course it is better to keep your own business records and then use these types of reports as a cross check on your records.  But with your challenges for last year, it may just assist you in getting through the mess of filing taxes.

[timberdoodle7]

I apologize if I'm "thick", but I am still confused about the Michigan tax. I live in Illinois and sold a bicycle to a fella who lives in Michigan. The invoice that Ebay created had the purchase price and 6% tax. The buyer paid the purchase price and tax amount to me. I have no clue who to send the tax money too other than ?? the State of Michigan. Do I do that or does Ebay do it? If I do, can someone tell me who to contact at the State of Michigan. What a pain!! I am not a business...just a person who buys and sells a few things each year on Ebay. Thanks

[mam98031]

---

@timberdoodle7 wrote:

I apologize if I'm "thick", but I am still confused about the Michigan tax. I live in Illinois and sold a bicycle to a fella who lives in Michigan. The invoice that Ebay created had the purchase price and 6% tax. The buyer paid the purchase price and tax amount to me. I have no clue who to send the tax money too other than ?? the State of Michigan. Do I do that or does Ebay do it? If I do, can someone tell me who to contact at the State of Michigan. What a pain!! I am not a business...just a person who buys and sells a few things each year on Ebay. Thanks

---

@timberdoodle7 

If you look at that payment a bit closer in your PP account, you will see that the sales tax amount paid was removed from your account and remitted to Ebay.  Ebay will process the payment to the state.  You don't have to do anything.

Here is some information that may help you to get a better grasp on this subject.

https://community.ebay.com/t5/Announcements/NOW-LIVE-New-Internet-Sales-Tax-changes-that-impact-you/...

https://www.ebay.com/help/buying/paying-items/paying-tax-ebay-purchases?id=4771