Sales tax collected on Ebay for my state

[flyingpig]

Are these taxes sent to me by Ebay as part of my income? They don't show what the breakdown is and I have to pay my state board taxes before the end of January. I don't want to pay taxes on the income amount that includes taxes! I need to deduct that amount ebay charged so I am paying the correct amount to California. Any tips here? Thanks so much! Michelle

[wildpitchsports]

I believe eBay collects the sales tax and submits them to the correct state on your behalf. On your 1099 (if you get one) it also doesn't include any sales tax paid by the buyer. 

If you collected the sales tax yourself for some reason then you'd have to pay it because you collected it.

[flyingpig]

I live in California and have added sales tax to my listings for those sales that are shipped within the state. So does ebay include that sales tax into my income? It's not clear on this new financial statement or even on the monthly reports.

[heckofagame]

eBay collects and remits sales tax for any state requiring it, including California.

And no, the sales tax is not part of the income shown on the 1099-k.

[flyingpig]

WOW! So I don't need to fill out my annual state board of equalization tax forms and send in a check because it's taken care of? I'd sure like to have ebay reassure me of that, as I've been paying every year.  Thanks!

[dbfolks166mt]

     You need to take a close look at any items you have sold or have posted. If you have added sales tax into the cost area of your listing then it is possible that both you and eBay are collecting sales tax. However, if eBay is collecting the sales tax for items sold in California, as they should be, then they are also remitting it to the state on a periodic basis. Any sales tax you collected is simply additional income since there is nothing for you to remit. However, there may be a number of implications related to this. 

[wildpitchsports]

---

@flyingpig wrote:

I live in California and have added sales tax to my listings for those sales that are shipped within the state. So does ebay include that sales tax into my income? It's not clear on this new financial statement or even on the monthly reports.

---

If you collected it then I would hazard to guess it would be on a different line that the normal way of eBay collecting it and paying in your behalf. It's easier these days to do it that way no matter where you live IMO

[flyingpig]

Well, I see that items sold in California are taxed (when I dig down deep into the transaction details), I just don't see how to know that Ebay is sending me the money to remit, or if they are doing it. Managed Payments doesn't break it down to that level. I would think if they are sending taxes on my behalf, that I would receive something saying that. Otherwise, how would they know? I have a resale license and can't just hope that ebay is doing things correctly. Does that make sense?

I track sales through GoDaddy Bookkeeping Services and it shows the same dollar amounts as positive and negative. Ugh. I'm so confused.

[coastaltechsolution]

eBay will remit , just keep good records of all transactions  

[stainlessenginecovers · Accepted solution]

All states that Ebay collects Sales Tax For are 

A.) Not collected by you

B.) You don't have, and have never had, that money to remit to that state

C.) If you originally set up your listings to collect sales tax, once eBay took over, those taxes were now NO LONGER being collected or set up, by you.

For states that don't show (yet) the 'facilitator collected' line, you put all those sales as 'out of state' (foreign for example as shown on the Cali Tax Sales Tax Form) and unless you sell elsewhere and collected tax (swap meet, own website, other selling venues that do NOT collect for you); you simply would have $0 collected and report $0. 

[flyingpig]

Thank you so much! I greatly appreciate all this! 

[lacemaker3]

@flyingpig,

eBay is not really collecting and remitting sales tax on your behalf. Believe me, they fought long and hard against being forced to do this, and they wouldn't do it if they didn't have to.

eBay is collecting and remitting sales for all sales that are delivered to California (and most other states that have sales tax) because the states passed legislation that says that Marketplace Facilitators, that facilitate payments for sales on their website, are required to collect and remit the sales tax.

eBay started to collect and remit sales tax for California on October 1, 2019. At that time, they disabled your sales tax table, and you have not received California sales tax for any sales to buyers in California since then. eBay sends it directly to the buyer's state, it does not go into your eBay account, and it's not included in the payouts sent to your bank account.

https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121#section3

According to the California legislation, if you only sell through a Marketplace Facilitator (like eBay, etsy, Amazon, ...) then you are not responsible for collecting sales tax anymore, because they are doing it.

If you still have a sales tax license, then some states may require you to submit a zero-tax statement, to document that you did not have any taxable sales for the tax period (or to report them if you did). You should check with California to find out what you need to do, because these rules are different in every state.

You might be able to get rid of your sales tax license, but you may need to keep it for other purposes, such as making tax free purchases for your business.

[saritafive]

I just wanted to say thank you for taking time out of your day to write that very helpful and detailed response. You made my day so much easier by providing that info and I appreciate it!

[creativeconsignment2012]

Is there a report to pull up how much sales tax was paid to an individual state? The state of Hawaii is trying to charge me extra tax on anything sold just in Hawaii. I cannot find a way to view only Hawaii 

[vsb1146]

We made several purchases from a seller in Indiana. We live in Texas. Is ebay collecting Texas taxes on my out state purchases an submitting to Texas? Are collecting sales tax for Indiana and submitting them to Indiana?

We are confused on this.