avoiding sales tax on purchased items

[wasatchm]

hi.

I purchase a lot of items in my home state for resale on ebay.  I come from a small state and rarely do buyers from my home state purchase from me.  

I pay sales tax on everything I purchase (it's about 6 1/2 percent in my state).  is there a way for me to get  waved from paying sales tax on these items I resell.?

keeping in mind that I almost always sell these items to buyers in other states.  

if there is a way to do that, how would I do it?

thanks 

[wasatchm]

"Ordinarily, I find that purchasing things at retail stores for re-sale is not a very wise move.  Even without sales tax, such items are not usually priced low enough to be good candidates for re-sale."

I agree.   I have to drive 50,000 miles/yr and visit thousands of retail outlets to make a full time living at it.    somehow I need to start buying bulk (from auction houses wholesalers).  I think for auction houses, quite often they only auction in pallets or bulk lots and I would need to plop down thousands of dollars to make a purchase.    I have been trying to do both this and then buying used items for resale (from thrift stores, estate sales, storage shed auctions).

I probably oughta look into liquidation type auctions...when a business goes bankrupt and then auctions their entire business (including inventory).  

[ymeagainlord]

A LOT of your retail sources aren't going to be in a position to give you the ST exemption (thrifts etc, and do you REALLY want them knowing you're a reseller anyway?) and the better idea with these is to add up the ST paid and then enter that as a credit on your ST form when you remit.

[myboardid]

A couple of things need to be clear - you ONLY need a sales tax license in your home state, and from your description on the license you just got it the correct one. 

You do NOT need licenses in the ship-to states. 

You REALLY need to talk to an accountant and set up your bookkeeping appropriately.

Sales tax permits (licenses) are supposed to be for wholesale purchases.  I have a retail store and from time to time I get someone who says they want to purchase for resale (makes no sense in my store because the items are priced at full retail or even higher).  Even with a resale permit I know the item is not going to be re-sold.  So I have a rule - the buyer has to purchase a minimum of 24 items of the same design before I will even consider accepting the resale permit and not charging sales tax.  That very rarely happens because there are only a few items that I even have that many of. 

[ebbyisme]

"Ordinarily, I find that purchasing things at retail stores for re-sale is not a very wise move.  Even without sales tax, such items are not usually priced low enough to be good candidates for re-sale."

I agree people shouldn't try that ever.....

There are exceptions to every rule.

I have bought auction, liquidation auction and retail in bulk. When I buy from retail (in bulk at stores) I often pay less then 1% of retail price. And when I buy in bulk I often pay for the whole lot on the first sale. Unfortunately these type of items are not usually high in demand, quick sellers and who has a warehouse to store inventory? not me, anymore. But don't message me (and by "you" I mean the people who message you after any post asking questions), I wouldn't tell you if you tried to torture it out of me and I am sure some already know, and they won't tell you either. Sourcing is the most valuable thing a seller has. Also this is why some people buy something retail on clearance for $3 and try to sell it for $15-20 and wonder how others are asking less... because they paid less then 0.05 for the item.

[wasatchm]

I have wanted to move more into the buy bulk and sell mass items arena.   that way you don't need a huge profit per item to make a living.  

if I go that direction, I have determined I may very well need additional help ( labor) to ship items.  I've really enjoyed being a ONE PERSON business.  is does have it's limitations though .   maybe with all the automation in shipping, I could ship several hundreds items myself PER DAY without needing additional help.  right now I just use ebay to print shipping label.  but I imagine for those that ship hundreds of items per day, shipping software would be required.

I have learned that to make good money, you have to be one step ahead of everybody else.   if you're not, you'll be working 10X as hard just to make a living.