5 Steps to Conquer July Sales Tax

taxjarlogoAuthor Mark Faggiano is Founder and CEO of TaxJar

July is what we here at TaxJar call a “sales tax perfect storm.” Nearly every online seller will have a sales tax filing due date this month.

If you’re new to sales tax, or if it has been awhile, check out these 5 simple tips for conquering July sales tax filing:

Know Your Due Dates

Since sales tax is governed at the state level, the actual day of the month you pay can vary. In the majority of states, sales tax is due on the 20th day of the month after the taxable period. But some states want to hear from you on the 15th, or the last day of the month. This date can also change due to holidays. Check your July 2016 sales tax due dates here.

Make Sure You Collected the Right Amount

When filing, the state expects you to remit how much sales tax you “should have” collected, even if, for some reason, you were unable to collect the correct amount. (For example, eBay’s sales tax system only allows you to collect sales tax at one rate per state, which means that you often have to charge either too much or too little sales tax to buyers.) If you find yourself in a situation like this when filing your sales tax return, double check that you are filing what you should have collected. If you’d rather not pore over your individual sales by hand, TaxJar has a simple “estimated sales tax due” report that will help you with this!

 File “Zero” Returns

If you are registered for a sales tax permit in a state, be sure to file a sales tax return even if you didn’t collect any sales tax over the taxable period. States want to hear from you on every due date. They consider this a “check in.” If you don’t file a sales tax return, you could end up with consequences from a $50 fine to the cancellation of your sales tax permit. Nobody wants to pay a $50 fine when you didn’t have any sales tax to remit in the first place!

Don’t Discount Sales Tax Discounts

About half the states also realize that asking you to collect, report and file sales tax places an administrative burden on sellers. For this reason, they allow you to keep a very small percentage of sales tax you collected. This amount is usually 1-3% of the total, but can add up over time. Don’t leave money on the table!

Automate Future Filings

If you find yourself spending valuable hours on sales tax filing that you could be using to work on more profitable business activities, then you can automate your sales tax filing.  TaxJar AutoFile will file your sales tax returns for you in almost every state for just $19.95 per state per filing. Not sure automating sales tax filing is right for you? Check out 6 Reasons to AutoFile Your Sales Tax Returns.

Have questions or comments about sales tax? Join the conversation at the Sales Tax for eCommerce Sellers Facebook Group!

 TaxJar is a service that makes sales tax reporting and filing simple for over 5,000 online sellers.  Try a 30-day-free trial of TaxJar today and eliminate sales tax compliance headaches from your life!

Your April Sales Tax Cheat Sheet from TaxJar

taxjarlogoMark Faggiano is the founder and CEO of TaxJar

Though it doesn’t get nearly as much attention compared to that other “Tax Day,” April is what we here at TaxJar call a “sales tax perfect storm.” Not only is April the big day when it comes to filing your income tax, it’s also holds a sales tax due date for nearly every online seller.

I know you’re busy pulling together all your income tax info and don’t want to tear your hair out over sales tax, too. So I’ve put together a quick cheat sheet so you can quickly and easily get those April sales tax returns off your plate.

April Sales Tax Cheat Sheet for Online Sellers

  • Remember that every state is different – Each state gets to make it’s own laws and rules when it comes to sales tax, so don’t think that just because New York wants to hear from you by the April 20th due date all other states follow suit! Here’s a list of April sales tax filing due dates by state to help you out.
  • Know your sales tax filing frequency – When you registered for your sales tax permit, your state assigned you a filing frequency. April is a “sales tax perfect storm” because monthly filers and quarterly filers in most states have sales tax returns due. Be sure you know your filing frequency so you know whether or not you have a due date this month.
  • Report sales tax the way your state wants to see it – Wouldn’t it be nice if you could tell as state “Hey, I collected $155.33 from buyers in your borders” and be done with it? Unfortunately, the vast majority of states want you to break down how much sales tax you collected from buyers based on their location. And this includes figuring out their state, county, city and other “special taxing district” tax. Ouch! But never fear, TaxJar will connect with the channels you sell on and break those numbers down just the way your state wants to see them.
  • File and pay the right way – Make sure you pay on time to avoid penalties and interest. You can login and file online, or let TaxJar file for you with AutoFile. Be sure to file a return even if you didn’t collect any sales tax over the taxable period! Some states will levy a fine or even cancel your sales tax permit if you fail to file a “zero return.”
  • Don’t discount sales tax discounts – About half the states realize that collecting sales tax is a huge hassle, and they will offer you an (admittedly small) discount for filing on time. Check here to see if your state has a sales tax discount and make sure to take it. Otherwise you’re leaving free money on the table! If you AutoFile with TaxJar, we always make sure you keep your discount in your pocket where it belongs.

I hope these tips have helped you navigate the April sales tax perfect storm. If you have any questions about sales tax, check out our Sales Tax 101 Guide for Online Sellers or ask away in our Sales Tax for eCommerce Sellers Facebook group!

TaxJar is a service built to make sales tax compliance simple for eCommerce sellers. Try a 30-day-free trial of TaxJar today and eliminate sales tax compliance headaches from your life!

 

 

Where the Amazon Fulfillment Centers Are Located (And Why You Need to Know)

markfaggianoMark Faggiano is the founder and CEO of TaxJar, a service built to make sales tax compliance simple for eCommerce sellers. Try a 30-day-free trial of TaxJar today and eliminate sales tax headaches from your life!

 

Amazon doesn’t make it easy to keep track of the locations of the Amazon fulfillment centers. Between new warehouses opening up all the time, warehouses occasionally closing, and the opening of data centers and the fairly new “sortation centers,” keeping up with where your Amazon FBA inventory is housed can be downright confusing.

 

But as an FBA seller, you do need to know where your Amazon inventory is stored due to one thing: sales tax nexus.

 

That’s right, housing your inventory in a state likely gives you sales tax nexus in that state, meaning that you need to collect sales tax from buyers in that state. Here’s a map with info about each state and what constitutes sales tax nexus.

 

How Do You Find Out Where You Have Nexus?

 

So you sell on FBA and you know you have inventory has been shipped to other states. But where do you have nexus?

 

First of all, you have nexus in your home state. You live there and run your business there.

 

Second, you can use a couple of methods to find out where you have nexus due to FBA. You can run this report in Amazon Seller Central, or use a paid service like Wherestock.com.

 

Once you’ve figured out where you have sales tax nexus, your next step is to register for a sales tax permit in each state. Then, set up sales tax collection with Amazon. (You can find a step-by-step guide to setting up your Amazon sales tax settings here.)

 

Do you have questions about sales tax nexus? Start the conversation in the comments!

Don’t be Blown Over by April’s Sales Tax Typhoon

taxjarlogotaxjarlogoMark Faggiano is the founder and CEO of TaxJar, a service built to make transaction sales tax compliance easier for multi-channel ecommerce sellers. Mark’s passion is solving complex problems for small businesses. He previously cofounded and led FileLater to become the web’s leading tax extension service for both businesses and individual taxpayers before being acquired in 2010.

The team at TaxJar has what it takes to have your business hit the mark with sales tax. TaxJar can pull together your sales records from all the channels on which you sell, organize that information into sales tax return-ready reports, and then deliver it to the state(s) in the way they need to have it. Plus, we keep track of which state has been paid and when you paid them.

The issue with sales tax is that it is not only tedious, it also can be baffling. It is especially when it comes to due dates. The state gives you these dates once you are registered for a sales tax permit.

Regrettably, these dates vary by being monthly, quarterly, semi-annually, or annually. They also can vary state to state. Not to mention that one year you could file annually and the next year you could be filing monthly. The term ‘quarterly’ can also vary because some states use different sets of months as their ‘quarters.’

Not to mention if you sell on FBA or another fulfillment service, you could find yourself remitting sales tax to 18+ states.

April Sales Tax Due Dates- A Storm Brewing

No matter whether you are an online seller or not, April is usually a big month for taxes. Even if you didn’t collect a penny in sales tax, remember often states will require that you file a “zero return.” If you neglect to file, be mindful that the state will most likely give you a penalty. A $50.00 penalty when you didn’t owe tax to begin with is no fun!

To help you be in the loop, we have gathered a list of April Sales Tax Due Dates for each state. Take a second read about your requirements when you have some time.

While you’re there, think about getting a free trial of TaxJar for 30 days. Let us take the work out of taxes for you. This way, you get to do what you do best – running your business!

That Kat Radio – Podcast 3 – January 20, 2015: Mark Faggiano – TaxJar

In this episode, Kat spoke with Mark Faggiano.

thatkat

 

Mark Faggiano is the founder and CEO of TaxJar.  TaxJar is a service that automates sales tax compliance for multi-channel eCommerce sellers. Mark’s passion is solving complex problems for small businesses. He is on a mission to make sales tax simple for online sellers.  He previously co-founded and led FileLater to become the web’s leading tax extension service for both businesses and individual taxpayers before being acquired in 2010.

_________________________________________________________

[smart_track_player url=”http://filesource.abacast.com/wsradio/thatkat/012015/segment1012015.mp3″ title=”Segment #1″ ]

Questions that were asked and answered were:

  1. What exactly is Sales Tax?
  2. Do all eCommerce Sellers need to collect Sales Tax?
  3. Why is it so complicated for FBA sellers?

_________________________________________________________

[smart_track_player url=”http://filesource.abacast.com/wsradio/thatkat/012015/segment2012015.mp3″ title=”Segment #2″ ]

Questions that were asked and answered were:

  1. What do you say to those who tell you that they won’t collect sales tax and are not afraid of the consequences?
  2. What’s so unusual about the month of January for FBA Sellers?
  3. How do the states decide when you have to file

_________________________________________________________

[smart_track_player url=”http://filesource.abacast.com/wsradio/thatkat/012015/segment3012015.mp3″ title=”Segment #3″ ]

Questions that were asked and answered were:

  1. What is the Marketplace Fairness Act?
  2. Is it still alive?
  3. What are the chances online sellers will eventually have to collect sales tax?
  4. Where does eBay stand and what are they doing?
  5. Where does Amazon stand and what are they doing?
  6. What can we as online sellers do?

_________________________________________________________

Questions that were asked and answered were:

[smart_track_player url=”http://filesource.abacast.com/wsradio/thatkat/012015/segment4012015.mp3″ title=”Segment #4″ ]

  1. What is TaxJar?
  2. Is Taxjar for all eCommerce sellers or just FBA sellers?
  3. How does Taxjar help us?
  4. How much does Taxjar cost and are there any discounts?
  5. How do we learn more about Taxjar and find out if it is for us?

Links from the show:

http://www.bubblefast.com

Purchase one of Kat’s books on Amazon. Kat’s Sales Tax Book or Ultimate Guide to Savings by Store.

Join her Facebook Group to be notified of upcoming shows.

“Sales Tax Tips for Ecommerce Sellers” – Top Rated Seller Webinar Media Alert

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Free eBay Seller Webinar – “Sales Tax Tips for Ecommerce Sellers”

REDWOOD CITY, CA GoDaddyOnlineBookkeeping along with Page Mage Inc., eBay Radio, Stamps.com, Terapeak and Kabbage will be hosting a free webinar for eBay® sellers.

 

Find out what selling on multiple channels in multiple states means for collecting sales taxes. Learn about the general rules of sales tax compliance for online sellers, how nexus with other states can be triggered by using third-party fulfillment, and the latest news on the Internet Sales Tax laws.

What you’ll learn:

  • What selling on multiple channels means for your sales tax returns
  • Destination versus origin-based sales tax states
  • What nexus means for sellers using third-party fulfillment services
  • Update on where the Internet Sales Tax law stands
  • And more!

 

WHEN: Wednesday, December 11th, from 10:00 a.m. – 11:00 a.m. PT / 1:00 – 2:00 p.m. ET

 

SIGN UP: http://pagemage.com/education/webinars

 

The webinar will be recorded and a link sent to all registrants when it’s complete. So signup even if you can’t attend live.

 

You do NOT have to be a Top Rated Seller to participate. The webinar is for eBay sellers of all sizes and levels.

 

 

PRESENTED BY:

Mark Faggiano, industry expert and Founder / CEO of TaxJar – a service built to make post-transaction sales tax compliance easier for multi-channel ecommerce sellers. Mark previously co-founded and led FileLater to become the web’s leading tax extension service for both businesses and individual taxpayers.

 

 

Top Rated Seller Webinars Sponsors:

 

About GoDaddy Online Bookkeeping

GoDaddy Online Bookeeping has one goal: to make bookkeeping as simple as possible so the self-employed can spend as little time as possible on the least enjoyable part of running a business. GoDaddy Online Bookkeeping’s easy-to-use online accounting solution automatically brings together all of your sales & expenses in one place so you always know what’s going on with your business and are ready come tax time. No math, no manual entry, no paper work. GoDaddy Online Bookkeeping integrates with eBay & PayPal, e-commerce accounts, and, of course, your Bank and Credit Card Accounts so you can stay up to date effortlessly and instead focus on doing what you love.

 

About Page Mage

Page Mage is transforming the way sellers market their products on eBay. Page Mage provides easy to use applications for creating better listings and bigger profits. Our Billboards and Smart Gallery applications in the eBay App Center are both “Top 10 Most Popular” and let you create breakthrough listing designs to stand out from your competition, look more credible and professional, improve selling performance, and increase confidence among buyers.

 

About eBay Radio

The host of eBay Radio is Jim “Griff” Griffith, eBay’s Dean of Education and author of the Official eBay Bible. eBay Radio broadcasts (eBay Radio; eBay Radio’s Ask Griff & Lee; and eBay Town Hall) feature helpful guidance, advice, and information from eBay team leaders and guest experts along with hot eBay topics, news direct from eBay, and your calls!

 

About Stamps.com
Stamps.com (Nasdaq:STMP) is a leading provider of Internet-based postage services. Stamps.com’s service enables small businesses, high-volume shippers, enterprise shippers, and consumers to print U.S. Postal Service-approved postage with just a PC, printer and Internet connection, right from their home or office. The Company targets its services to small businesses and home offices, and currently has PC Postage partnerships with Avery Dennison, Microsoft, HP, USPS and others.

 

About Terapeak

Terapeak is a leader in ecommerce market research and payment analytics, and is the sole authorized re-licensor of eBay data globally. The company provides custom insights and SaaS technology-enabled solutions to e-commerce merchants around the world.

Currently aggregating over 20% of all online commerce sales data, Terapeak helps merchants make faster, more-profitable business decisions based on real-time market trends, pricing, and transaction data.

 

About Kabbage, Inc.

Kabbage, Inc., headquartered in Atlanta, Georgia, has pioneered the first financial services data and technology platform to provide funding to small businesses in less than 7 minutes.  Kabbage leverages data generated through business activity such as selling online, shipping data, and  dozens of other data sources to understand business performance and craft financing options for  small businesses.

####

MEDIA CONTACT:
Mallory Snitker

SS|PR

msnitker@sspr.com

(847) 415-9300

Amazon Expands its UK-Based Operations Despite Tax Issues

A few weeks ago, Amazon announced that as its first step toward expanding its European operations, they would be opening a new office in central downtown London. The proposed new 12-story building would be located in Holborn and would employ about 1600 in staff. Due to be completed by September, this 210,000 square-foot office building would also become home to Amazon’s existing staff that are currently working out of office space in Slough, Berkshire.

Amazon-LogoWhile this press release would seem like a cause for celebration by both Amazon and the Londoners it will employ, Amazon is once again on the chopping block and being accused of not paying their taxes. Yep, it’s the same old song and dance we’ve heard several times before. This time, however, it’s United Kingdom lawmakers that are making the accusations.

As you may recall, this issue has come up recently in the United States where Amazon has been successfully avoiding paying taxes in states such as New York and Georgia. They, of course, claim that they plan to pay the taxes, but have negotiated to delay making any payments by offering to build warehouses in each of these states (and others) that would bring 1000s of jobs into the economy. You may be noticing that this seems to be their “get out of jail free” card.

Interestingly, lawmakers on both sides of the pond seem to be somewhat uneasy about actually pursuing Amazon for these unpaid taxes despite the fact that at times Amazon comes across as belligerent and even defiant about paying what the governments say they owe. In particular, is London’s mayor Boris Johnson, who stated that he was delighted that Amazon chose his country’s capital even though he was quite vocal about Google when they tried to buck paying their taxes as well.

So exactly how much does Amazon owe? Well, the IRS in the United States is pursuing Amazon for $234 million, while the French government’s tax authority hasn’t completely accessed the tax situation, but is estimating that it is around $250 million. Meanwhile, Amazon is disputing both tax bills and doesn’t appear to plan on paying either one of them (or any other tax they owe) anytime soon.

I’m not sure if I would call this a savvy business strategy on Amazon’s part, but the whole thing does kind of make you wonder, especially when Amazon has been so vocal and supportive of making its own buyers and sellers pay the Internet sales tax while they continue to fill their own coffers, yet don’t pay any taxes of their own.

 

 

 

 

 

Dealing with Sales Taxes When Selling at Out-Of-State Trade Shows and Conventions

“I sell collectible stamps and coins on eBay and locally. I currently collect sales tax in the State of California. Beginning next year (when I retire from my day job) I want to start travelling around the U.S. going to big stamp and coin conventions, setting up a vendor stand and selling merchandise and networking. However, I am being told I need to get a sales tax I.D. in each state by the people running the conventions. Do I really need to do this for a 3 day event? It is causing me huge issues.

If I get the sales tax I.D.s in each state I will then have to collect sales tax on all of my online transactions. This will create far too much paper work and record keeping for myself, I currently run the entire business with myself and some help from a friend. Is there any way around the option of getting sales tax I.D.s in each state? Can I just pay the sales tax out of my own pocket to avoid filling all of the paper work?”

This is not a “rare” situation at all; in fact, it applies to anyone who sells merchandise at a trade show.

You are always required to pay taxes on “in state” sales – where the seller and buyer are in the same state at the moment of sale.  Whenever you sell merchandise at a trade show, you are selling “locally” — the seller and buyer are considered to be in the same state (the trade show floor) at the time of sale.

When are you “selling” on a trade show floor?  Here are the basic rules:

  • if you are merely advertising and promoting your business on a trade show floor and not actually selling anything there, you are not liable for sales tax;
  • if you are taking orders for products or services on a trade show floor, taking the customer’s money there, and fulfilling the order later from your home office, you are liable for sales tax;
  • if you are taking orders for products or services on a trade show floor, shipping the merchandise to the customer after the show, and collecting their money at that time, you MAY be liable for sales tax (the rules here vary from state to state so check with your accountant before you sign up for the show).

Most states (such as New York, Illinois, and Texas) require out-of-state vendors to register for sales taxes on ALL sales made to in-state residents even if they spend only one day attending an in-state trade show or convention.  In Texas, you may also be subject to franchise (income) taxes.  The standout exception is Nevada, where you can fill out a “one-time sales tax permit” each time you attend a trade show or convention without registering for sales taxes generally (gee, I wonder why they’re so easy?)

In a shrinking handful of states, you are not considered to have nexus if you spend fewer than X days at a trade show (for example, four days in Minnesota, three days in Massachusetts, 16 days in California), but you are still required to pay tax on sales made during the show.

To get a sense of where each state stands, check with your accountant, or spend $125 and get a copy of the Bureau of National Affairs’ annual “Survey of State Tax Departments” (www.bna.com/statetaxsurvey), which lists each state’s nexus rules on over 200 situations affecting out-of-state vendors.

Many event sponsors will provide you with the necessary forms to handle state and local taxes on sales made during their events; some will even collect the tax and submit the forms for you.  If an event sponsor instructs you to register for sales taxes generally, then you probably will have to comply. After all, they and their tax experts have probably done everything they can to negotiate an exception for their exhibitors, and if they couldn’t succeed, you probably won’t either.

Note to eBay, Amazon and other online merchants.  Next week Congress will decide whether or not to enact the Marketplace Fairness Act of 2013, empowering roughly half of the states (those that have signed onto the Streamlined Sales and Use Tax Agreement www.streamlinedsalestax.org) to impose their sales taxes on Internet sales transactions if (1) the purchaser resides in the state, (2) the state imposes a single tax rate and a single point of collection, and (3) the seller has $1 million or more in total out-of-state sales (not just from the Internet) each year, among other conditions.

Even if your sales are well below the $1 million threshold, take a few minutes out this week to let your elected representatives know how the Act will impact your business.  To send a strong message to Congress that taxing Internet sales will hurt a lot of small businesses (whose owners vote), go to www.ebayinternetsalestax.com/ist/step1_b.asp or www.freedomworks.org/blog/mkibbe/freedomworks-key-vote-no-on-an-internet-sales-tax.

Cliff Ennico (www.succeedinginyourbusiness.com), a leading expert on small business law and taxes, is the author of “Small Business Survival Guide,” “The eBay Seller’s Tax and Legal Answer Book” and 15 other books.

State Sales Tax Continues to Be Sore Point for Amazon

As Amazon’s FBA sellers continue to struggle with understanding their new sales tax responsibilities, the debate over the national sales tax legislation carries on. Although Amazon has taken to falling back on the wording of its Service Agreement when it comes to informing sellers about collecting sales tax (Amazon doesn’t give tax advice), Amazon, continues to do its best to wiggle out of its own sales tax  problems. This week, the online marketplace even ended up dueling it out in court.

kat4 (1)On Wednesday, Amazon argued in the New York Court of Appeals that the New York law which states that companies with affiliates in the state must collect sales tax was actually unconstitutional. Although New York believes that affiliates in their state count as a physical presence or rather ôNexus,ö Amazon and Overstock.com (who is having their own problems with the tax issue)are rebutting this by saying that affiliates are not considered employees, independent contractors or even representative of  their companies. They argue that only non-Internet, out-of-state retailers who advertise their products through print, television, or radio in the state of New York should have to collect sales tax and that the sales tax should be paid by only New York customers.

While that case remains up in the air, Amazon is also stalling in collecting sales tax in the state of Georgia by negotiating with that state to not have to collect sales tax there until a later date. As part of these negotiation proceedings, they are conferring with lawmakers about a plan to build a distribution center near Atlanta. This would, of course, bring in hundreds of jobs to the state of Georgia.

Although Amazon has successfully pulled this move off several times in the states of Connecticut,Tennessee, Virginia and Texas, not everyone is in agreement with this proposal. House Minority Leader Stacey Abrams (D-Atlanta) stated to the Atlanta Journal Constitution (AJC) that she believes Amazon is trying to act above the law.

How all this will play out remains to be seen, but with brick-and-mortar stores complaining that a tax-free site gives Amazon an unfair advantage, it’s a safe bet to assume that Amazon will have to make changes to their sales tax policies at some point. The question then will be how the fallout affects sellers. For now — that remains to be seen.

We R Here – Online Retailers Helping Each Other Out

Recently, I received an invitation to join a video launch of a new company. This new alliance is one that promises to “ensure that government policies create a fair marketplace for all retail businesses to thrive.”  This is an idea which I give my full support to. All too often, as the “little guy,” our businesses are subject to unfair tax collection burdens belonging to the much larger businesses we compete with. Even right now, Congress is trying to pass new sales tax legislation that would dramatically affect us and our businesses. The We R Here coalition believes that small businesses like ours must be protected from unfair sales tax collections like this, and are taking steps to fight it. You can check out their site for yourself here. There is also a replay of the video conference they just held.

As most of you know, I just released a book that I co-wrote with tax expert Michael Rice about sales tax and the FBA seller. I used to be the kind of person who found tax law absolutely boring, but what we have to realize is that knowledge is power, and the more we know about issues like sales tax, especially about legislation that affects us and our businesses directly, the more we will be able to do about taking steps to protect ourselves and our business. I know that this is a group I fully support. You can join the coalition as well, once you decide if this is something you would like to be a part of, but my suggestion is to at least check out the site and see what they’re about. Check out the site and let me know your thoughts. I believe you can never be too informed! http://werherecoalition.org/