06-21-2018 08:13 PM
for me atleast. Folks that say this won't be a big issue and everyone is making a big deal out of nothing I think they're wrong. I'm not a huge seller, but I sell enough to know that it WILL be an issue for me, since over the years I bought a lot of items on Ebay to resell for a small profit. If this goes into effect, an item from out of state that would currently cost me $100, but after this passes it will be anywhere from $113.00 to $103.00 with an average around $107. I know this doesn't sound like much, but after paying Ebay their 10% and Paypal 3.5% the profit margins are low and now I will have to tack on another variable tax rate amount to my products cost.
Also, I know that if this passes I won't be buying as many items, since my wages haven't increased and this will just be another amount that will be taken away from my discretionary income. I think this will hurt online sales to what extent I don't know.
Anyways, I hope it turns out for the best, but I don't think it will and most small sellers will be the ones hurt the most. This is about helping the multiple billionare type companies while causing the small mom and pop online sellers to close up shop.
06-21-2018 08:23 PM
I do purchase some high end jewelry. And yes, it will make me think twice at what I puurchase to budget in that additional sales tax.
06-21-2018 08:38 PM
Well, many online buyers will absorb the shipping or a slightly higher cost (hidden shipping fee) for the trade off of no tax.
They simply won’t do that now unless it is a necessity.
They will drive the ten minutes to B&M and buy what they can touch and feel for less and not have to deal with the return shipping if there is an issue.
06-21-2018 08:42 PM - edited 06-21-2018 08:43 PM
I'm glad you started a new thread, because the last one is so long & convoluted that my head is spinning (what it means, and what it doesn't mean). I am just trying to figure out whether the amount mentioned as $100,000 or 200 sales is for each state or as a whole (as in 200 items sold in a single state OR 200 items sold all states total). Would you believe reading the tax law itself did not clarify it for me one bit?
I too buy to resell. So that would make a big difference in the bottom line. I am hoping the 'powers that be' at Ebay will clarify soon what this could/does mean. It could get very confusing with all the different tax codes. More work than it will probably be worth.
06-21-2018 09:31 PM
This is what I know so far after reading about this today.
South Dakota $100,000 or 200 sales
Colorado
How do these laws work? Unfortunately, the mechanics vary by state. Colorado in particular has one of the more robust notice and reporting laws. Beginning July 1, 2017, remote sellers that have over $100,000 of sales to Colorado customers and do not collect sales tax must:
Based on these provisions, companies could pay up to $125,000 in penalties in a single year even though they have no physical presence in Colorado.
Pennsylvania A remote seller that makes taxable sales totaling $10,000 or more to Pennsylvania customers in the previous calendar year must elect one of two options by March 1, 2018:
Collect sales tax or comply with use tax reporting this one is similar to Colorado;
Pennsylvania sales or use tax may be due in connection with the purchase and delivery of tangible personal property to Pennsylvania individuals and businesses.
The purchaser is required to file a use tax return if tax is due in connection with the purchase and delivery in the Commonwealth.
This notice is required pursuant to the provisions of the Tax Reform Code of 1971. 72 P.S. § 7213.2.
Pennsylvania sales tax was not collected on this sale. Therefore, you may be required to remit use tax directly to the Commonwealth on your purchase if the items are subject to Pennsylvania sales tax. Please visit this link to learn more about your use tax obligations under Pennsylvania law.
No statement that sales or use tax is not imposed on a transaction may be made by a remote seller, unless the transaction is exempt from sales and use tax, pursuant to Article II of the Tax Reform Code or other applicable Commonwealth law.
A remote seller making an election to comply with the notice and reporting requirements must submit an annual report by January 31 of each year to the purchaser that includes the following.
[Name of remote seller] did not collect sales tax in connection with your transactions. You may be required to remit use tax to the Pennsylvania Department of Revenue. Following is a list by date, type and purchase price of each product, purchased or leased by the purchaser from this remoter seller, and delivered to a location within this Commonwealth.
[Insert list]
Please visit to learn more about your use tax obligations under Pennsylvania law.
[Name of remote seller] is required to submit an annual report to the Department of Revenue that includes the name of the purchaser and total dollar amount of the purchases from this remote seller.
This report shall be mailed by first class mail, in an envelope prominently marked with words indicating that important tax information is enclosed, to the purchaser’s billing address, if known, or if unknown, to the purchaser’s shipping address. If the purchaser’s billing and shipping address are unknown, the report shall be sent electronically to the purchaser’s last known email address with a subject heading indicating that important tax information is being provided.
A remote seller making an election to comply with the notice and reporting requirements must submit an annual report by January 31 of each year to the Department of Revenue that includes the following:
A report required under this section shall be submitted by an officer of the remote seller and shall include a statement made under penalty of perjury by the officer that the remote seller made reasonable efforts to comply with the notice and reporting requirements of this part.
Each failure to comply with the notice and reporting requirements can result in a penalty of $20,000 per violation, per year, or 20 percent of total Pennsylvania sales during the previous 12 months, whichever is less.
Kentucky
Non-collecting retailers (i.e. retailers with no sales tax nexus in Kentucky who have more than $100,000 in gross sales in Kentucky are required to either register for a Kentucky Sales tax license and begin collecting sales tax, or inform buyers that they have the obligation to pay Kentucky use tax
Louisiana
Non-collecting retailers (i.e. retailers with no sales tax Nexus in Louisiana who gross $50,000 or more per year in sales to Louisiana buyers are required to either register for a Sales Tax Permit and begin collecting sales tax, or comply with Louisiana’s notice and report law.
06-21-2018 09:40 PM
And here are some more
Oklahoma
All non-collecting retailers (i.e. sellers with no sales tax nexus in Oklahoma, who make more than $10,000 in aggregate sales in Oklahoma in the previous 12 calendar months, are required to either register for an Oklahoma Sales tax permit and begin collecting Oklahoma sales tax, or, under H.B. 1019, to do the following:
Penalties:
Penalties for sellers who do not comply are:
The penalty is assessed separately for each violation but can only be assessed once per calendar year. For five years after this penalty provision takes effect, the OTC can abate or reduce the penalty or interest due to hardship or good cause.
This law went into effect in April 2018.
Rhode Island
Non-collecting retailers (i.e. retailers with no Rhode Island Sales tax nexus who make more than $100,000 in Rhode Island sales or more than 200 transactions to buyers in Rhode Island are required to either register to collect Rhode Island Sales Tax or comply with Rhode Island’s notice and report requirements.
To summarize:
If the non-collecting retailer elects to not to register and choose to comply with notice and report requirements, they must:
Tennessee
According to a 2012 law, non-collecting retailers (i.e. retailers with no sales tax Nexus in Tennessee are required to inform buyers that they may owe Tennessee use tax. However, there is no penalty for non-compliance.
This law went into effect March 26, 2012.
Vermont
Non-collecting vendors in Vermont (i.e. vendors with no sales tax nexus in Vermont are required to either register for a Vermont Sales Tax license., or comply with Vermont’s use tax notice and report law. Vendors who made more than $100,000 in retail sales in Vermont have more notice and report responsibilities.
06-21-2018 09:44 PM
and the rest of Vermont and Washington;
The following are Vermont’s requirements:
Penalties:
.Washington
Starting January 1, 2018 non-collecting retailers (i.e. sellers with no sales tax nexus in Washington are required to either register to collect Washington sales tax or comply with Washington’s notice and report law.
In summary:
Non-collecting retailers who choose not to register for a Washington sales tax permit are required to do the following:
You can read specific Use Tax Notice and Report Requirements for Washington here.
Penalties:
The state may assess a penalty of up to $20,000 that fails to provide notice to consumers. (The Washington DOR website does not make this penalty clear, so you can read the full Washington notice and report law here.)
You can read more about Washington’s notice and reporting requirements for online sellers here.
This law went into effect January 1, 2018.
This law went into effect July 1, 2017.
06-21-2018 10:11 PM
Thank you so much; this is a big help. I already collect for Washington residents (since I live here), but have never even thought of having to collect for any others. This clarifies some details at least. Thanks again.
06-21-2018 10:45 PM
@gew6463you are welcome this is going to get bigger than us. Most of it so far won't apply to small sellers the one I'm most worried about so far is Washington. I use Tax Jar to look up things and hopefully they will have more soon. Some are hoping and I am too that small sellers will be exempted from this. We shall see.
06-21-2018 10:53 PM
It’s possible that sellers may not have to deal with this and that eBay will collect..or..that small sellers won’t be required to collect..or there will be some standardization between states..... There are lots of possibilities so I wouldn’t get too bogged down on the details at this point.
Ebay has commented on the news in a number of threads on this board. See post 12 in the following thread.
06-21-2018 10:56 PM
@waterbed_bigfoot wrote:@gew6463you are welcome this is going to get bigger than us. Most of it so far won't apply to small sellers the one I'm most worried about so far is Washington. I use Tax Jar to look up things and hopefully they will have more soon. Some are hoping and I am too that small sellers will be exempted from this. We shall see.
Just watch and see Ebay will drop their control market plateform And Claim just A Venue ! They may do same as etsy . But will not spend money to do same As Amazon.
06-21-2018 11:16 PM
seems to me....that you pay sales tax if you go to a store, right?...so why wouldn't you on line?...
and for those who shop on-line....they like the easy click and shipped to the door aspect..sales tax or not...right? and yes , you could look then drive over to the store...and pay the sales tax...ummm...so what is really the difference to shoppers.... we shop online because it is easy and don't have to deal with driving, other people, etc.... sales tax....that part of life.
for sellers....the gravy train is ending...saw it coming, expected it to come , seems fair enough....and BTW...a buyer is suppose to claim it on their state income tax form(purchases out of state) __of corse not all states and there are many different rules...BUT just saying, did you not expect this?
The whole notion that it's putting mom and pop stores , etc out of business or making it tougher...well progress, and the internet started all that long ago....don't remember a grocery store poping up ..and everyone saying there goes the little stores?...and milk isn't delivered to the door anymore....well unless you shop on lone with a grocery store, and have it brought to you....full circle progress.
amazone has been collecting state taxes on many (think i heard 70%) of items over the years....so it can be done...and i also heard for small sellers...they may not have to--- there will be some sort of criteria for number or $ sales....like paypal and the 1099 form...you have to meet the requirement to have it done...otherwise you're on YOUR honor ...and claiming YOUR sales on tax form...
we will all survive, we adapt and change or die off....as it is in business and nature.
06-22-2018 12:04 AM
It has always been the customers' responsibility to pay use tax in their own state when they purchase merchandise from another state. The problem is that the state governments consider it too burdensome for them to go after tax dodgers, poor babies, so now we have to do it.
Big retailers have enormous bookkeeping and law departments to keep up with the tens of thousands of tax jurisdictions in this country, which small sellers do not. Not only do states have different sales tax structures and rates, but so do individual counties and individual towns within each state, and any of them can change without notice. My state has the various sales tax rates posted, but they have a disclaimer that every rate can change at any time, and if it does and you get it wrong when you send in the money, YOU are going to be punished for it, and they don't have to bear any of the responsibility. Now imagine that for 45 different states. If you really like the thought of getting audited by 45 different state internal revenue departments, then you're a lot different from most of us.
10-15-2018 09:33 AM
Colorado's new law going in to effect on December 1, 2018, is so scary I'm turning Colorado off on my website and I don't know what we'll do with ebay and Amazon. We have to charge tax according to where the package is delivered. That is hundreds of jurisdictions. Plus, many are called home rule cities or towns, so each of those require a separate tax filing. and I'M IN COLORADO! What will we do??? Definitely turn Colorado off on the website. Maybe Hire TaxJar for the other two? Have you seen any more info on this anywhere? I can find nothing. I could care less about people buying on ebay for resale on Amazon and losing three dollars. I am a legitimate business who will lose sales and besides that, how do you charge tax after the fact, file hundreds of forms every month (NO WAY). Would love some insight from other people.
10-15-2018 09:41 AM
Do you sell over $100K to Colorado a year? I'm thinking if you do it would be worth hiring an outside company to collect tax for you. Are you selling using software like Shopify? They may be required to collect in some States as Marketplace Facilitators.