Sales Tax... can be refundable for purchaser buying used goods previously taxed

[niteprowler]

There is a lot of misinformation about sales/use tax paid on items purchased on eBay.

In most states the casual (non-business) seller is not required to collect sales tax from the buyer.  eBay, having no way to know this, is acting as an agent and collecting tax for every state as if every sale is taxable.  eBay may be able to handle these sales differently, but they are not going to go to the trouble of acting in the favor of the seller/buyer.

Many states allow a credit for sales tax paid by a buyer of a used item on which tax was previously paid.  This credit can be refundable and usually requires the buyer file a return to claim the refund.  This prevents double/multiple taxation for sales taxes already paid on an item by a prior purchaser.  These rules vary by state as do the technicalities of filing for the credit or refund.

A good synopsis here (https://www.wolterskluwer.com/en/expert-insights/sales-and-use-tax-foundations-refunds-and-credits) provides a brief outline of each states regulations and requirements.

[niteprowler]

Here's a really good starting point for beginning to learn about sales taxes for sellers and buyers.  It pays (or saves you tax dollars) to know the facts.

https://www.bigcommerce.com/articles/ecommerce/sales-tax/

[dbfolks166mt]

     A lot of the links and information you have provided are basically codified in law(s) but there are several of your statements in you OP that are generalizations or inaccurate. 

"In most states the casual (non-business) seller is not required to collect sales tax from the buyer."

     It is not that they are not "required" to collect sales tax it is that most states have thresholds on the amount of sales a seller must attain before they are required to collect sales tax. However, since most casual (non-business) sellers are not reporting their sales as income anyway they are probably not reporting sales taxes either. 

  eBay, having no way to know this, is acting as an agent and collecting tax for every state as if every sale is taxable.  eBay may be able to handle these sales differently, but they are not going to go to the trouble of acting in the favor of the seller/buyer.

     Ebay is quite aware of the 12,000+ various state sales tax laws. By the Supreme Courts decision and designation they are not an agent, but the merchant of record for the purpose of sales tax computation and collection.  

"Many states allow a credit for sales tax paid by a buyer of a used item on which tax was previously paid."

     It's actually quite the opposite since most states require sales tax collection on the sale of both new and used items. Out of all the items you have purchased on eBay how many have you actually filed a claim with your state for the refund of the sales tax collected? 

[monica-sells]

ok...a step-by-step tutorial as to how I can do this.

I bought a used 1968 Les Paul. I purchased it from the original owner who still had the original bill of sale. Sold it to me through an intermediary. I paid sales tax. The original receipt shows he paid sales tax.

How do I get my 860 dollars back from the State.

[kensgiftshop]

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@niteprowler wrote:

Again... buy a $ 5000 guitar second-hand and you are likely entitled to a refund of the tax you paid... if the original owner or subsequent owner have already paid sales tax on it.

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Sales tax is on the transaction, not the item.

The guitar can be sold 10 times and if the state requires it, sales tax can be collected each time it's sold.

[bonjourami]

"Sales tax is on the transaction, not the item."

Absolutely, thats what the op doesnt get.

An internet sales tax is a sales and use tax collected and remitted on remote sales, many done online.

[thegraygrouper]

No one seems to be questioning the fact the Ebay charges the seller an additional 15% fee ON TOP of sales tax and shipping.  I don't see how that is legal for us to pay a fee on sales tax paid by the customer?  Am I looking at this wrong?

[fab_finds4u]

I thought this topic was done.

And what you're saying has been done to death!! 

By law eBay collects sales tax from the buyer. That is one issue. 

The only way you are not charged sales tax is  you must live in a state with no sales tax, or you have a sales tax exemption you filed with eBay.

The other issue, and it is a separate issue from collecting and remitting sales tax is eBay is charging the seller a fee for processing the buyer's total payment.  Item cost and applicable sales tax and shipping.  

That fee varies by the category  but it is always based on the buyer's total payment. Why do people always question the seller's final value fees?

When I was an Avon, Tupperware and Longaberger baskets distributor I never questioned or argued what ended up in my pocket. 

it amazes me how many people are so critical of eBay. Start your  own selling platform or leave if you don't agree with eBay fees.

[eburtonlab]

@thegraygrouper 

I don't see how that is legal for us to pay a fee on sales tax paid by the customer?

Which law is being broken, exactly?

[monroe67]

"No one seems to be questioning the fact the Ebay charges the seller an additional 15% fee ON TOP of sales tax and shipping."  

eBay sellers who are charged Final Value Fee (FVF) of "an additional 15% fee on top of sales tax and shipping" are sellers who are selling jewelry, even costume/fashion jewelry, and watches.  
eBay sellers who sell guitars are charged a FVF of 6.35% of the total amount paid by the buyer.  
Sellers in most other categories are charged a FVF of 13.25% of the total amount paid by their buyers.  

As for your opinion that "no one [else] seems to be questioning" that fact, you must not have been reading these forums for the last few years, starting in 2019 and maybe even late in 2018.  Lots and lots and LOTS of other sellers have questioned eBay's fee systems.  

"I don't see how that is legal for us to pay a fee on sales tax paid by the customer?  Am I looking at this wrong?"

You're not the first person to think eBay is doing something illegal by charging the FVF on the total amount paid by buyers.  People have even tried to claim it is both communistic and fascistic for eBay to charge fees on the total amount paid by buyers, which is really a contradiction in terms . . . . . .  (Schools don't teach this stuff anymore, but I learned it -- when and where?  See my eBay ID above.)  

No, it is not illegal for eBay sellers to pay a fee on sales tax paid by the customer.  

You can "look[] at this" -- eBay's fee structure -- any way you choose to.  
However, it is what it is: eBay does charge sellers a Final Value Fee based on the total amount paid by the buyer.  

I've used that phrase several times in this post:  Total Amount Paid By The Buyer.  
That total amount will most often include some sales tax and some shipping charges.  
Thus, yes, sellers do pay a fee to eBay based on sales tax and shipping.  
That's a Fact of eBay.  Accept it or don't.