Florida Sales Tax collection by eBay

[thewholesalelife]

Hello everyone,

Has anyone else had issues with eBay not collecting the sales tax for Florida buyers correctly? I have the tax table set up to collect 6%, but eBay is collecting sales tax on non-taxable items in Florida, so they have over collected. Does anyone have any advice on how to address this issue? I've contacted eBay and they say that it looks fine on their end, but it's obviously not.

Also, I knew that I needed to now remit the over collected sales tax, but Florida has informed me that I cannot remit it to the state of Florida, but to actually refund each buyer for the over collected sales tax.  Oh My....there have been a lot of sales in the last quarter. Is there an easy way to do this?

Thanks for any help on this.

[releasethekraken_1]

Collection of sales tax on nontaxable items can happen if the item is listed in a category intended for items that are taxable. Which items were taxed when they shouldn't have been?

[thewholesalelife]

Items like nutritional supplements drinks and wound bandages, which are non-taxable in Florida. I thought the same thing, so I double checked the eBay categories and it looks correct. 

[alcoforever]

I'm assuming you are in Maine but you have a nexus in Florida and that you have a 6% tax table for FL applied to your listings.   I'm also assuming that it is you collecting the tax, and not ebay.

According to the ebay chart of marketplace facilitator states, FL is not included so ebay shouldn't be collecting anything for sales to  FL.  Chart is here: https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121#section3

It may be possible to selectively apply the tax to your items on an individual basis.   If possible, that is your solution.    If that doesn't work, then it would seem that the ebay tax table gets applied to everything you sell to FL, regardless of its taxability.

[valueaddedresource · Accepted solution]

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@alcoforever wrote:

I'm assuming you are in Maine but you have a nexus in Florida and that you have a 6% tax table for FL applied to your listings.   I'm also assuming that it is you collecting the tax, and not ebay.

According to the ebay chart of marketplace facilitator states, FL is not included so ebay shouldn't be collecting anything for sales to  FL.  Chart is here: https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121#section3

It may be possible to selectively apply the tax to your items on an individual basis.   If possible, that is your solution.    If that doesn't work, then it would seem that the ebay tax table gets applied to everything you sell to FL, regardless of its taxability.

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@thewholesalelife  - @alcoforever  is absolutely on the right track here.  Florida does not yet have a Marketplace Facilitator tax law on the books, so if you have nexus in Florida, it is up to you to do everything - set the rates, set up your listings, collect & remit the tax, etc.

When you create a listing, there should be a checkbox on the listing form for whether or not to use the tax rate table.  Your only option to accomplish what you are trying to do at this time is going to be to uncheck that box on any products that are not taxable in Florida.

However it is important to understand that is an all or nothing setting. If that item is taxable in other states where you need to collect tax directly, and you uncheck that box, it will not collect tax for those states either.

[alcoforever]

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@alcoforever wrote:

I'm assuming you are in Maine but you have a nexus in Florida and that you have a 6% tax table for FL applied to your listings.   I'm also assuming that it is you collecting the tax, and not ebay.

According to the ebay chart of marketplace facilitator states, FL is not included so ebay shouldn't be collecting anything for sales to  FL.  Chart is here: https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121#section3

It may be possible to selectively apply the tax to your items on an individual basis.   If possible, that is your solution.    If that doesn't work, then it would seem that the ebay tax table gets applied to everything you sell to FL, regardless of its taxability.

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Update to the above:

I don't see anywhere in the SYI form to apply sales tax to an item.  I too set up a 6% FL sales tax table first.

So, looks like everything you sell to FL will get the 6% tax applied.   If you have kept good records, you should be able to refund each buyer individually.  

Slightly off topic:  too bad you don't live in California.   Here, we have the choice of either refunding the buyer or just sending the overcharged tax to the state.

[thewholesalelife]

Thanks. So, yes, I guess I have been collecting the sales tax, by setting up the tax table for eBay to use. I guess I would have to decide if it would be best to uncheck the box for collecting sales tax for those particular items, so the sales tax would NOT be collected BUT it would also be for other states that are set up in the tax table, like KS and MO, which I do need to collect. (and some of those items are not tax exempt in those other states) 

If only eBay would make it bit easier to set up sales tax for sellers, with certain exempt items in certain states. 

[alcoforever]

I think what I would do in your case, assuming you cannot selectively apply sales tax per item, is just refund those customers that complain.   I see your most expensive item is around $80 so that would be ~$4.80 while many of your items are in the $20 range with a tax of around $1.20 - hardly worth the time to research and then refund.

[thewholesalelife]

I do think that all states should have the option to easily remit the overcharged tax to the state. I know that some do offer that. 

[thewholesalelife]

I agree with you. Now it's just trying to figure out what the best way is to handle the collection of the FL taxes in the future, so this doesn't continue to happen.  

[latienditaonlinestore]

I just spoke to an eBay agent via Chat (Bryan), According to Bryan, eBay is collecting sales tax for Florida (FL) and they are remitting the payment on our behalf. The tax is automatically calculated based on the buyer's location.

I am really happy eBay is doing it, this takes one administrative task off the list 🙂

Have a Blessed Day Everyone...

Stay Safe.

[380rebecca]

So, related question, as you stated above Ebay collects sales tax for FL (I'm a FL seller). Does the "collect sales tax" button for my listings still need to be checked, or is a moot point if Ebay is automatically doing it?  Does it matter anymore?

Thanks

[dbfolks166mt]

It's not just Florida which now has an ecommerce sales tax law on the books and are collecting the sales tax and remitting it to the state. What I am not sure of since I don't check the sales tax on each and every sale is how accurately eBay is collecting the sales tax. Florida, like a lot of other states, has different tax rates for different types of merchandise and I am unsure if eBay has factored that in. Some of the tax laws can be VERY complex, Illinois probably being the worse, that not only have different rates for the merchandise but have different rates depending on what county or city you live in. EBay is also required to collect and remit those taxes. 

     Illinois has a state sales tax of 6.25%, and allows local governments to collect a local option sales tax of up to 4.75%.  There are a total of 898 local tax jurisdictions across Illinois collecting additional sales tax on top of the 6.25%.