Charging tax on United States coin sales

[hajnick]

Does eBay still charge tax on the sale of U.S. coins? I have not sold coins on eBay recently because eBay has been charging tax on the sale of U.S . Coins. They have lost my business because charging tax unnecessarily by eBay is a big ripoff and I do not want to be ripped off by anybody. I will resume selling coins on eBay only if eBay does not charge a tax on the sales of U.S. coins. Can eBay shed light on this sickening issue? U.S. Mint sells yearly proof sets to the public and resale value of these sets nowadays is roughly one tenth, yes 1/10th, of the U.S. Mint issue price.  What a wasteful investment! Buy a set from U.S. Mint for $22 plus shipping and resell the same set for $2.00. What a shame! Now we have to pay tax on the $2 recoup and net 9 cents on the dollar; with shipping, it will become a return of 8 cents on each dollar.  I don’t mind the big loss because I enjoy the hobby. But I mind adding fuel to fire. 

[albertabrightalberta]

@hajnick 

You are mistaken. 

It's not ebay that charges sales tax. It's your state for which ebay collects sales tax and forwards it. 

Different states have different taxability on coins. You'd have to check your own state's department of revenue website to see what's taxable and what's exempt from sales tax. 

Be aware that any site you do business with is required to collect tax and forward it to the various states.

[hajnick]

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@albertabrightalberta wrote:

@hajnick 

You are mistaken. 

It's not ebay that charges sales tax. It's your state for which ebay collects sales tax and forwards it. 

Different states have different taxability on coins. You'd have to check your own state's department of revenue website to see what's taxable and what's exempt from sales tax. 

Be aware that any site you do business with is required to collect tax and forward it to the various states.

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Neither Illinois nor the U. S. Mint charges any tax on the sale of U.S. coins or banknotes. I have no trouble understanding this issue but eBay seems to have trouble understanding this issue. And I neither need nor care for you to understand it for me. I just want eBay to stop charging tax on eBay coin sales because it is not necessary if the seller lives in Illinois. I am not sure how to stop eBay from doing that.

[itscalledapostingid]

Fact: Sales tax is charged based on where the buyer lives.

[dbfolks166mt]

     By tax I am assuming you are talking about sales tax. If so the answer is yes in most cases but it depends on the state the buyer is located in. At present I believe 45 states, Missouri was the last, have passed sales tax laws regarding the collection of sales tax on ecommerce sales in the wake of the Supreme Court decision in Wayfair vs South Dakota. 

     So it's not only eBay but every ecommerce site out there. If you lost your business over the sales tax laws there is more to it than just the sales tax and you pretty much addressed that in your OP. EBay has nothing to do with what the resale value of a set of US mint sets are that is determined by good old economic supply and demand and the equilibrium price. 

     If you are talking about income tax that is a separate issue but eBay has nothing to do with that either it is all based on Federal and State income tax laws. 

[duffy4444]

   It is not the type of item  that is being charged sales tax. It is the online sales transaction  that is being taxed. Big difference, and you need to understand that. It has nothing to do with the item itself. Online sales venues, just like eBay, have no choice but to charge sales taxes based on the buyer's state, county, and local rates and tables. And it is the buyer who pays the sales tax, not you the seller.

Cheers, Duffy

[hajnick]

I am specifically referring to sales of coins only. I understand taxing sales of general merchandise. In Illinois, sales tax is not charged on buying or selling coins, banknotes, or legal tender but eBay still charges tax on sales of U.S. coins. The U.S. Mint does not charge tax on coin sales regardless of where the buyer is. Why is eBay still charging tax on coin sales? 

[hajnick]

I perfectly understand charging tax on general merchandise. I am just referring to sales of U.S. coins. Illinois does not charge tax on sales of U.S. coins, neither does the U.S. Mint. Thanks!

[itscalledapostingid]

@hajnick 

Once again sales tax that's charged on online sales is based on the buyer's location. Not the seller's.

Since the United States Mint is a federal government operation, purchases are exempt from sales tax.

[hajnick]

Thanks Duffy! Buyers of U.S. coins have literally shamed me for being charged tax on buying U.S. coins. Coin collectors do not comprehend paying tax on buying U.S. coins. They are not used to that. I am careful not to get negative feedbacks so I end up absorbing the sales tax by crediting the buying. This is not sustainable for me. It adds up over time. Nick

[mam98031]

It is important to remember that if YOU are in Illinois, that doesn't matter at all and plays no part in determining if SALES TAX is due on a transaction you may have.  Sales tax is driven by the State in which the Buyer has told you to SHIP TO.  That state's rules is the ONLY state that matters in a transaction.

For example:  You ship some coins from Illinois to the state of Washington.  The sales tax is determined by the state of Washington's laws.

Also it is important that the seller of this kind of stuff gets them in the correct category.  When Ebay determines Sales Tax for whatever state the item is being ship to, the go by the laws of that state and Ebay does this by Category.  So if you aren't posting in the correct category, that too can affect if Sales tax is charged or not.

Ebay charges ZERO taxes at the request of the US Mint.

[hajnick]

Thanks! I still have a problem. Coin collectors are not used to paying sales tax on buying U.S.  coins. Coin buyers have complained being charged sales tax and shamed me, the seller, for being charged the sales tax. In every case, I ended up crediting the buyers the sales tax so that they would not leave me a negative feedback. It is not a very easy situation. Best, Nick

[duffy4444]

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@hajnick wrote:

I am specifically referring to sales of coins only. I understand taxing sales of general merchandise. In Illinois, sales tax is not charged on buying or selling coins, banknotes, or legal tender but eBay still charges tax on sales of U.S. coins. The U.S. Mint does not charge tax on coin sales regardless of where the buyer is. Why is eBay still charging tax on coin sales? 

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@hajnick:

   Ebay is not making a distinction of charging or not charging sales tax on coin sales... by law, eBay is charging the buyer sales tax on the online transaction. They charge sales tax on anything and everything that is sold online, if the buyer's state requires it in its online commerce sales tax collection laws Those laws have been quickly and pretty universally passed since the Wayfair vs South Dakota decision by the US Supreme Court.

   You're hung up on the type of item that is the subject of the tax. My understanding is that the item is immaterial... For example, when I lived in California, certain food items were not taxed when I walked into and purchased at my local supermarket. But if the same item was purchased by a California buyer online by eBay, Etsy, or other online commerce marketplace, sales tax would be charged. That's because it's all about the transaction, not the item.

Cheers, Duffy

[mam98031]

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@hajnick wrote:

Thanks! I still have a problem. Coin collectors are not used to paying sales tax on buying U.S.  coins. Coin buyers have complained being charged sales tax and shamed me, the seller, for being charged the sales tax. In every case, I ended up crediting the buyers the sales tax so that they would not leave me a negative feedback. It is not a very easy situation. Best, Nick

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They have to follow the law in the state they are in.  No one is above that.  You aren't the only coin seller on the site.

When a buyer complains, you just need to tell them that it is the law in their state.  Some buyers still are use to having to pay sales tax on an internet sale, even though it has been going on for about 4 years.

[mam98031]

@duffy4444 

IDK about that.  Various states have different laws.  Some don't have sales tax on used clothing, food, shipping charges, coins, etc.

If your seller has the items in the correct category for food items, you should not be charged for sales tax.