What we Need as Members to Enhance the Sales Tax Collection process by Ebay.

[mam98031]

In an effort to assist Ebay in seeing and knowing the issues we see with Ebay collecting sales tax for certain states I thought we could have a discussion about it so that Ebay knows our thoughts and concerns.

This is something Ebay has to do, so that isn’t the issue.  We may not like it, but they still have to adhere to the new laws.  Sellers and some buyers have specific needs that aren’t being met.  These needs have to be addressed as they are important factors.

Ebay is very much aware that there is room for improvement and I believe they are actively working on improving the process.  But just in case they haven’t thought of some issues, this discussion may help.

Here are some of the things I see in no specific order.

1. We need a way to submit our Resale Certificates so that Ebay has them on file.
2. We need a way to flag a purchase on Ebay to be for Resale so that we are not charged Sales Tax.
3. We need a report that shows by state what taxes were collected on our behalf. Some states require us to report this information.  Some of us have to report the full sale amount as a retail sale and then we can take a deduction for that sale because Ebay has taken the sales tax from the customer and remitted it to the appropriate state.  This report needs to give us the ability to get it by date range.  Some of us report to our states monthly, some quarterly and some yearly.  So we need flexibility in the report.

What do you see as an improvement or enhancement specific to Ebay collecting sales tax in various states?

[myjunqueyourtreasure]

Just adding the amount of Sales Tax collected by ebay so we can see it on the order details would help.

[slippinjimmy]

If you registered to collect sales tax in the States eBay is acting as marketplace facilitator you can recoup any taxes you paid that should be exempt because of your resale certificate, you do so when you send in your own return.

I doubt very much that eBay are going to accept resale certificates, subject to far too much abuse and eBay would be responsible if sellers used bogus exemption numbers (which would certainly happen).

I don't see how it could be "enhanced", as it stands now sellers don't have to do anything, can't get much easier than that.

When I file my Sales Tax return I show Gross Sales and taxes actually charged and collected, since I sell a combination of taxable and non-taxable items the tax I report is never equal to a straight percentage of gross sales. I've had a few Sales Tax audits over the years, never had a problem.

Now that eBay is collecting (not in my State yet), if questioned I would explain to an auditor that the taxes on my eBay sales are collected and remitted by eBay as a Marketplace Facilitator.

[mam98031]

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@slippinjimmy wrote:

If you registered to collect sales tax in the States eBay is acting as marketplace facilitator you can recoup any taxes you paid that should be exempt because of your resale certificate, you do so when you send in your own return.

I doubt very much that eBay are going to accept resale certificates, subject to far too much abuse and eBay would be responsible if sellers used bogus exemption numbers (which would certainly happen).

I don't see how it could be "enhanced", as it stands now sellers don't have to do anything, can't get much easier than that.

When I file my Sales Tax return I show Gross Sales and taxes actually charged and collected, since I sell a combination of taxable and non-taxable items the tax I report is never equal to a straight percentage of gross sales. I've had a few Sales Tax audits over the years, never had a problem.

Now that eBay is collecting (not in my State yet), if questioned I would explain to an auditor that the taxes on my eBay sales are collected and remitted by eBay as a Marketplace Facilitator.

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I understand all of that as I am also not new to this.  However having facilitator tax laws are new and none of us have been through an audit with these new laws in place, so our previous experiences are important, but this is an added new twist.

I'm in the state of Washington and we are suppose to report our gross sales both subject to sales tax and sales that are not.  Normal stuff.  But if we do not have a report we can generate from Ebay regarding which sales inside the state I do business in, then it just makes my job harder.  They have the data, we just need a report.  It shouldn't be a big deal.  My opinion is it is a normal business request.

Of course I would take the deduction off my retail sales for the amount of sales that Ebay collects sales tax for me.  But this is an easier thing to do if I have a report I can get off Ebay to balance with.

It may not be important to you, but for some of us it is.  I'm not saying you are wrong.  You have every right to do things as you see fit and if it works for you, that is fantastic.  For others, we may like to see things a bit differently.

[sharingtheland]

I agree with both myjunque and jimmy.  I think all we're going to get, hopefully because it is needed, is the ability to see the amount of sales tax collected and remitted to what state on each sale, if applicable.

I don't think there is any way ebay is going to get into the tax exempt resale situation of sellers in different states with different laws and requirements.  It's going to be up to each seller to handle that and I sincerely don't think it's going to be a big IRS tax audit issue.

[mam98031]

I think some have misunderstood the intent of the thread.  I'm NOT saying in ANY way that we are going to get anything I've outlined in my OP.  I'm merely asking what others might see that they need or would like to have.  NOTHING more. 

[sharingtheland]

And I replied as instructed.  

We need a report on sales tax collected when and sent where that includes every affected sale.

I don't know of anything else to suggest because I don't think we're going to get anything else we suggest.  I will admit, however, to not giving this a lot of thought as yet.

[mam98031]

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@sharingtheland wrote:

And I replied as instructed.  

We need a report on sales tax collected when and sent where that includes every affected sale.

I don't know of anything else to suggest because I don't think we're going to get anything else we suggest.  I will admit, however, to not giving this a lot of thought as yet.

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I'm sorry if my comment came across harsh or insulting to you.  It was not intended that way, my apologies.  It was intended as a general reply, however I forgot to mention that.  My bad for sure!

[alcoforever]

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@mam98031 wrote:

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I'm in the state of Washington and we are suppose to report our gross sales both subject to sales tax and sales that are not.  Normal stuff.  But if we do not have a report we can generate from Ebay regarding which sales inside the state I do business in, then it just makes my job harder.  They have the data, we just need a report.  It shouldn't be a big deal.  My opinion is it is a normal business request.

Why can't you just report gross sales as non-taxable since ebay has already taxed your WA sales?

[mam98031]

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@alcoforever wrote:

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@mam98031 wrote:

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I'm in the state of Washington and we are suppose to report our gross sales both subject to sales tax and sales that are not.  Normal stuff.  But if we do not have a report we can generate from Ebay regarding which sales inside the state I do business in, then it just makes my job harder.  They have the data, we just need a report.  It shouldn't be a big deal.  My opinion is it is a normal business request.

Why can't you just report gross sales as non-taxable since ebay has already taxed your WA sales?

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Because it is a different category of sales on the reporting form.  And it is what the state is instructing us to do.  It isn't a matter of paying the taxes again or anything like that.  Just proper reporting.

I suppose you could do as you have stated, but it isn't what the state is asking us to do.

[alcoforever]

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@mam98031 wrote:

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@alcoforever wrote:

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@mam98031 wrote:

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I'm in the state of Washington and we are suppose to report our gross sales both subject to sales tax and sales that are not.  Normal stuff.  But if we do not have a report we can generate from Ebay regarding which sales inside the state I do business in, then it just makes my job harder.  They have the data, we just need a report.  It shouldn't be a big deal.  My opinion is it is a normal business request.

Why can't you just report gross sales as non-taxable since ebay has already taxed your WA sales?

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Because it is a different category of sales on the reporting form.  And it is what the state is instructing us to do.  It isn't a matter of paying the taxes again or anything like that.  Just proper reporting.

I suppose you could do as you have stated, but it isn't what the state is asking us to do.

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I think you are over thinking it.   There are only 2 categories, right?  Taxable and non-taxable.   All your sales are non-taxable.

[dhbookds]

Has anyone actually asked their State Dept entity that handles Sales tax what an individual seller is supposed submit since a marketplace facilitator is handling the sales tax collection and remission? 

[the*dog*ate*my*tablecloth]

Washington hasn’t had a sales tax reporting period yet though right? Even if you previously reported/paid quarterly, that won’t be due until April. Do you already know what the State will require? I don’t think you can go by last year, sales tax was completely different.

[7606dennis]

One of the biggest issues has always been the lack of a way to collect sales tax within a state based on the particular delivery location within the state.  Many states require the collection of sales tax at different rates based on the delivery location of the item.  Unfortunately, eBay's system has never allowed for this.

With regard for the handling of tax exempt sales, it would probably require eBay to be in contact with each state's department of revenue to see how they want to handle such things.  Each state has their own laws regarding such matters.

When it comes to eBay collecting and remitting sales tax in states having Facilitator laws, I would suggest sellers that normally collect sales tax in those states to contact their department of revenue to see how they want to handle it.  If a seller in Washington state were to collect sales tax on sales made to buyers in their own state and now eBay collects it as a Market Facilitator the buyer would be taxed twice.  Of course, the merchant would need to be able to account for the sales on their sales/use tax returns as well.    

[sharingtheland]

 My bad for sure!

I wasn't insulted; not to worry !