mam98031 • Volunteer Community Member • Buyer/Seller since 1999
@rosszonebricks wrote:
@forgottenape wrote:you should have been collecting your states sales tax for in state customers for as long as you have been selling better hope they don't do an audit triggered by any taxes you now pay
Don't listen to this nonsense. As others with correct information have said, you as a seller need to do nothing different.
It is the buyers that should have been reporting their internet purchases all along so they could they, as the buyer, pay their state sales tax. However, nearly literally no one did, which is why this newer legislation is continuing to be implemented.
@forgottenape was absolutely correct. Everyone that comes to this site or similar to sell stuff should be reporting their sales to the state in which they reside in. Along with that if their state has a sales tax, they should have been collecting and remitting that to their state as well. This is what we all should have been doing prior to the recent changes with the Facilitator laws coming into affect.
Forgottenape was speaking to the OP and their specific state and what they said was accurate.
Now with respect to the Facilitator Marketplace laws, Michigan doesn't currently have one. I think they will as of early 2020, but as of now they do not. So the OP still needs to collect and remit sales tax for ANY sales that they ship to another address in their state.
@femmefan1946 wrote:Nope.
Under a certain amount (which varies from government to government) the revenuers don't want to know.
If someone in a 5% state sells $1000 a year, that's $50 in taxes that cost $100 to process and administer. And since those taxes are remitted monthly, that's actually $1200 for processing.
I can only speak for Ontario Canada, but we were not required to register, collect , or remit sales taxes until we earned $30,000 Cdn annually.
Under that was considered too expensive to collect.
At the time we were registered ( a B&M store, online sales, and an international public auction) the ON sales taxes were 13%- five percent national and eight percent provincial.
Now.
Income tax is different.
Keep track of all your expenses and your customer payments, because you should be declaring the difference (the profit) on your income taxes.
I respect that you are in Canada and may not know the state laws in the USA. I was not incorrect in what I previously said. And I wasn't talking about income tax. In all states in the USA you have to claim your sales to our respective states. No matter our size. There are discounts and deductions each state has for small businesses, but that doesn't mean that they don't have to submit the forms on time to their state.
I can not and will not speak for how things go in Canada as I have no knowledge of that. But I've been in the US all my life and I've been running my own business for quite a few years.
FYI, many states allow small businesses to report just once a year. My state is one of them. And I've always been under the threshold of actually having to pay any B&O [business and occupation] taxes, but I'm still responsible for filing the report and paying sales tax that I've collected throughout the year on any sales that I've had within my state.
Don't confuse state business taxes with income taxes. They aren't the same thing in the US.
@jaad_6732 wrote:You don't have to do anything in regards to collecting or submitting the tax but what confuses me is that if you have a valid vendors license your required submit your state tax monthly, by monthly or twice a yr. Regardless of if your sales are zero. I'm not sure how to know what ebay collected or submitted and if you file by phone and you put in your sales for the state it doesn't give you the option to say ebay paid them for you. And with all of these states opting into this if someone owned their own online store would they have to have a valid seller's permit in all 50 states separately so they could have a state tax i.d. for each one? This would involve submitting 50 times a month for 50 different states for some people. And is other sites like etsy , amazon, wish all filing the taxes for everyone also. I see this as becoming a huge mess in the near future. People are going to get summons to court for tax evasion in states they don't even live in.
We all need to be careful when giving out this kind of advice. It isn't always correct. In this particular case, for the OP, there is NO Facilitator law yet in place for Michigan. The OP IS RESPONSIBLE for collecting and remitting sales tax for sales within their state.
While small businesses are required to report their sales to their state, irregardless if any sales tax is owed, in whatever time requirements they may have, monthly, quarterly or yearly, it is likely they won't owe any taxes to the state other than sales tax for in state sales.
Not all 50 states have sales tax. There are a handful that do not. And yes if you have your own website and you meet the threshold requirements for sales into any given state, you will have to collect and remit sales tax to those states. There is software available for businesses that are large enough for this to be a concern which will lessen the hardship of the accounting end.
Its a mess for those that aren't staying informed and educated on these changes. For those of us selling on Marketplaces like Ebay, Etsy, Amazon, Sears, Walmart, etc. it is quite easy.
@collectablesofliberty wrote:
@mam98031 wrote:
@jaad_6732 wrote:You don't have to do anything in regards to collecting or submitting the tax but what confuses me is that if you have a valid vendors license your required submit your state tax monthly, by monthly or twice a yr. Regardless of if your sales are zero. I'm not sure how to know what ebay collected or submitted and if you file by phone and you put in your sales for the state it doesn't give you the option to say ebay paid them for you. And with all of these states opting into this if someone owned their own online store would they have to have a valid seller's permit in all 50 states separately so they could have a state tax i.d. for each one? This would involve submitting 50 times a month for 50 different states for some people. And is other sites like etsy , amazon, wish all filing the taxes for everyone also. I see this as becoming a huge mess in the near future. People are going to get summons to court for tax evasion in states they don't even live in.
We all need to be careful when giving out this kind of advice. It isn't always correct. In this particular case, for the OP, there is NO Facilitator law yet in place for Michigan. The OP IS RESPONSIBLE for collecting and remitting sales tax for sales within their state.
While small businesses are required to report their sales to their state, irregardless if any sales tax is owed, in whatever time requirements they may have, monthly, quarterly or yearly, it is likely they won't owe any taxes to the state other than sales tax for in state sales.
Not all 50 states have sales tax. There are a handful that do not. And yes if you have your own website and you meet the threshold requirements for sales into any given state, you will have to collect and remit sales tax to those states. There is software available for businesses that are large enough for this to be a concern which will lessen the hardship of the accounting end.
Its a mess for those that aren't staying informed and educated on these changes. For those of us selling on Marketplaces like Ebay, Etsy, Amazon, Sears, Walmart, etc. it is quite easy.
We are located in Michigan also and yes you are correct, for all taxable sales in michigan, you must collect our 6% sales tax. Yes, you can also sign up for reporting sales tax only once a year. Lastly, if your OP, sales are lower than $3000.00 a year, you will not be charged from what I understand, though, you should ask your tax adviser.
Thank you for your post. In the state I am in while you need to report all your sales to the state, there aren't any business taxes on it until you exceed about 44,000 in gross sales. But you still need to report even if you don't owe any business taxes or sales tax.
@jaad_6732 wrote:Is etsy and amazon also collecting sales tax like ebay now?
YEP!!! As are other marketplaces. In Fact Amazon has been collecting it a lot longer than Ebay has because they have so many nexuses in so many different states [warehouses and the such].
It is an Internet sales tax, NOT an Ebay sales tax. Laws passed by individual states, NOT by Ebay.
