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General Category => General Scroll Saw Talk => Topic started by: northie66 on September 12, 2010, 09:40:18 pm
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I'm going to sell stuff on etsy. Well, hopefully I sell stuff! :D
Anyway, I live in Pa. I know that if someone from out-of-state buys from me, I don't have to worry about tax. But what about in my state? I'm not a business... just me with a hobby.
Can you tell me your experience with this? Please let me know what state you are in and if you own an actual business or not.
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Janet, I believe you are still correct about out of state sales. However our great politicians are after all the money they can get and want to start taxing all internet sales - so far however its not passed.
As for in state sales, you are usually responsible for reporting and collecting state sales taxes whether you are a business or hobby- no difference in most states. I have heard of some trying to collect sales tax on garage sales!!! If you have an on-going presence on-line you will usually be requires to collect the tax. This is the way I read the rules in Michigan and Tennessee.
Bill
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I wont tell if you wont
Jimbo
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What's this thing called tax?!!!!!!!
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ive sold on both ebay and etsy with pretty good success, specially during the holidays. whats this tax thing youre talking about, is it new? lol
seriously though, ive never charged tax before.
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Janet, I know here in California you are required to get a license to sell products, morally you should but that is up to you. If you sell things periodically then it's your call. If you sell on a regular basis it is best that you collect taxes to stay on the good side of the law. My advice is to contact your city franchise Tax office and ask them. I know that not all States collect sales taxes and your out of State sales may be exempt.
Mike
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I think I'll just not and see how it goes. If I start selling alot, then I'll get one. I'd hate to go through all that and then hardly sell anything.
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In Texas - you have to get a tax ID #. The advantage to that is your materials are tax exempt. However, you get the pleasure of filing a quarterly tax return to pay the tax collected. Some shows, (I know you don't go to shows) require you to show your tax ID. Uncle Sam also wants his piece of your pie. If you sell on EBay or any other online source where your sales can be tracked by Big Brother, you might want to consider getting an ID. The advantage of that is your material costs can also be tax deducted as a business expense. Turbo Tax makes it easy to file your expenses.
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julief said it well. It is the same here in North Dakota. I like not having to pay sales tax on my materials. But I only have to do the sales tax report every 6 months.
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Janet I also live in Penna. I don't sell on ebay, but I do sell in craft shows, I don't really sell enough to warrent sales tax. This is a hobby of mine, and the way the economy is its a shame Seniors can't make a little money, after all thay take away from us. So Screw them all, and thats the way I feel. Edward
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The problem with the "Screw them all" attitude is that you never know when someone from the comptrollers office will show up at a fair and request your tax ID. If you don't file your return - they assume you made way more that you did and assess your penalties off their assessment. Better safe than sorry.
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I did a very small show once just by myself and someone from the tax dept came and bought the cheapest piece I had just to make sure I charged sales tax. (I found out who he was afterward). Now I have a sign that says ALL PRICES INCLUDE THE SALES TAX. I make all my prices come out to even $$'s but know the price before tax.
$4.68 + 7% sales tax is $5.00 easier to make change.
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charge a couple bucks extra and put it in the bank. if you get hit up for taxes you will have it if not you have a savings account. i think there are too many taxes already on the stuff we buy to make the stuff we sell. we should be able to keep what little profit we make. Mike
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7% tax is not bad, ours goes up next month to %15 a rise of %2 1/2 but we don't have to declare unless yearly sales exceed around $70ks and if I was selling that much I would have to have staff
Jimbo
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It's not only sales tax that you have to worry about starting next year.
"beginning in 2012 all companies will have to issue 1099 tax forms not just to contract workers but to any individual or corporation from which they buy more than $600 in goods or services in a tax year."
If you're a professional woodworker and replace or upgrade your equipment, you've got to send the dealer a 1099 tax form. Makes no sense to me, but the IRS thinks they can find millions in unreported taxes from small time businesses.
Just something you might want to talk to your tax guy about.
CNN has a fairly decent article on it below.
http://money.cnn.com/2010/05/05/smallbusiness/1099_health_care_tax_change/
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Thanks Doug for that link. That's informative!
Karl
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Interesting article. Thanks!
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My wife does freelance work, and just trying to wrap my head around what these rules all mean is a big chore for me this year. Hopefully this one will be reviewed and adjusted to make more sense.