# Collecting Sales Tax



## Mellifera

Any other NYS people out there? I'm working on my online store. One issue is how I'm going to collect NYS sales tax. In NYS, taxes are collected based on the location to which the goods are delivered. The state tax rate is 4%, but localities differ in their rates--my local rate is also 4% for a total of 8%, but other counties/towns/etc. can have 4.75%, for instance, which means on sales to that location, I should charge 8.75%.

Is anyone doing it? How do you do it? Do you manually figure the tax and add it as a separate charge? "Eat" the tax by not collecting it from customers, but reporting it (by location!!!!) to NYS tax authorities? I don't think the shopping cart program I'm using is sophisticated enough to figure different rates based on address and zip. 

Thanks for any suggestions!


----------



## hmlove1218

I know nothing about New York, but in Mississippi, the sales tax charged is only the sales tax for the manufacturing area. For example, where I live, there aren't any local tax rates, but in Tupelo I believe there's a local tax of 1% or 2%. I only have to charge the state's tax of 7%, but if I were to relocate to Tupelo, I'd have to charge 8% or 9%. Does that make sense? Are you sure that's not how you're supposed to charge tax? Like I said, I have no idea how NY taxes work, so if I'm wrong I apologize.


----------



## Mellifera

Unfortunately, I'm sure! it would be so much easier and make so much more sense if the tax applied where the goods are sold (my location), but no.


----------



## leapinglizards

How does the - So called- Amazon law apply there?   What does Amazon do in NY?

It seems pretty unreasonable.  

Internet sales ave always been sticky.  It really would be easier if they DID just create an internet sales tax federally and distribute it to the sates.


----------



## pamielynn

Right now I'm only collecting on in-state shipments, based on MY location. That's what the rule was when I started. I'm sure I'm doing it wrong, but I have no idea how you find out all the tax rates for out of state locations. The two states I've lived in most of my life - one had NO sales tax, the other was the same across the state. Here in TX, it varies from city to city.

At shows, I collect for which city I'm IN, which is a huge PITA, too.


----------



## Mellifera

leapinglizards said:


> How does the - So called- Amazon law apply there?   What does Amazon do in NY?
> 
> It seems pretty unreasonable.
> 
> Internet sales ave always been sticky.  It really would be easier if they DID just create an internet sales tax federally and distribute it to the sates.



I know about the Amazon law in NY, but how major retailers apply it... I assume they have the programming power to look up the tax rate based on the destination address. It wouldn't be THAT hard to do, with some programming, but I'm not really willing to do that (I used to be a sysadmin, and in a pinch, I COULD... but I really don't want to start modifying OpenCart).


----------



## Mellifera

I think I have my answer: Tax Cloud https://taxcloud.net/default.aspx It's free, it "easily" integrates with shopping cart programs. I guess I'll let you know if that's true! Calculates sales tax in real time for every state, county, city, and special jurisdiction in the US
Automatically files sales tax returns*
Prepares monthly state-by-state reports on sales tax collected
Monitors changes to tax rates and tax holidays and updates data accordingly
Manages sales tax exemption certificates
Registers sellers*

It can't do the filing and registration in NY, but that's ok. If it can figure the tax based on address, that is the biggie for me.


----------



## pamielynn

I just don't get it. I'm only charged sales tax on in-state internet sales, too. So why would I charge for out-of-state sales? Too confusing - I'll let the tax man get me when he does 

Eh, the law I just looked up says that unless you're selling over $1 million a year, you're not considered a "physical presence". Works for me.


----------



## Mellifera

I don't need to charge for out of state, but I do need to charge within NY State, and since different municipalities have different tax rates, it would be a nightmare to figure it by hand.


----------



## cmzaha

I know when I sell here in CA I charge the rate for the county I am selling in. But this is not for internet sales. With my square I just change the tax rate per county. When filing my sales tax it goes by each county I have sold in


----------



## Dorymae

I live in Connecticut.  We only have state tax so it is a bit different but if the law says you must collect the tax from where you sell it then you should be able to set it up that way on a web site.  For selling at open markets etc.  What I do is I figure the tax first and add it to the price of my products.  The customer doesn't see it broken down but I know and explain if asked.  I've found it is easier that way because at places like flea markets people expect the price they see to be the price they pay.  Now in shop it's different then you should break it out.

The key to sales tax is to keep very good records, and if you collected it, pay it on time.


----------



## heather s

I am in NYS and I have found no easy way to do this. I am also positively sure that it is based on destination and with state and county taxes...ugh. I agree that there must be a program out there somewhere. If you find an answer please let me know.


----------



## kmarvel

I live in AZ and about to open my online store.  I am not sure how to charge for tax for my soaps.  On another note, how do you know what to charge for shipping costs??  I was thinking of using those padded envelopes for shipping the 1 or 2 bars to a customer.


----------



## xmaker1

What checkout cart are you using? 3dcart looks to have a manual input for different area codes I'm sure what ever cart you use would have something similar. https://support.3dcart.com/Knowledgebase/Article/View/102/2/how-do-i-add-tax-to-my-3dcart-store


----------



## xmaker1

kmarvel said:


> I live in AZ and about to open my online store.  I am not sure how to charge for tax for my soaps.  On another note, how do you know what to charge for shipping costs??  I was thinking of using those padded envelopes for shipping the 1 or 2 bars to a customer.



Find a cart with a built in tax functionality. If you ship out of state you don't generally have to pay tax on it is my understanding so unless you get a majority of sales from in state you could just skip over the taxes or take a bite on the profit of the bar. I know for myself seeing an added tax makes me look for something outside of my state.


----------



## Mellifera

heather s said:


> I am in NYS and I have found no easy way to do this. I am also positively sure that it is based on destination and with state and county taxes...ugh. I agree that there must be a program out there somewhere. If you find an answer please let me know.



It looks like there are add-ons for some shopping cart programs. NY State is a nightmare, since you have to calculate the tax at the destination, and cities and counties have different tax rates. So my area is 8% but one destination near NYC was 8.75%. 

I'm considering using Amazon for the time being, just to get up and running and not have to deal with it.


----------



## new12soap

"Tax cloud" didn't work out? I know there are programs that add on to shopping carts that are supposed to be able to do it by zip code.


----------



## Mellifera

In the end, I didn't try Tax Cloud. It probably works fine. I need to hire someone to help me with the graphics of the shopping cart--I'm technically adept, but not graphically! So I'm thinking maybe back off from the whole project, and look at amazon as a web sales venue, for instance.


----------



## houseofwool

new12soap said:


> "Tax cloud" didn't work out? I know there are programs that add on to shopping carts that are supposed to be able to do it by zip code.




In Wisconsin, zip code doesn't work as taxes are collected by county and zip codes lines don't match county lines. *sigh*


----------



## yadonm

I live in NYS and am under the impression that you pay sales tax where the seller is physically located.  If I'm at a craft fair I charge tax from the county I am in.  If I'm shipping from my home I charge the 8% for Niagara County.  I'm very fortunate to have a son in law who's a tax professional.


----------



## new12soap

yadonm said:


> I live in NYS and am under the impression that you pay sales tax where the seller is physically located.  If I'm at a craft fair I charge tax from the county I am in.  If I'm shipping from my home I charge the 8% for Niagara County.  I'm very fortunate to have a son in law who's a tax professional.



I believe that is incorrect.

If you are at a craft fair, yes the tax rate is for that location, where both the buyer and seller are physically located at the time of sale. If you are shipping from home to anywhere within NY state, the tax rate is based on the recipient's address.

http://www.tax.ny.gov/bus/st/sales_tax_rates.htm


----------



## new12soap

houseofwool said:


> In Wisconsin, zip code doesn't work as taxes are collected by county and zip codes lines don't match county lines. *sigh*




Wisconsin's Department of Revenue states that the 9 digit zip code (or "zip + 4) will give you the correct tax district, if you have that. If not you should be able to enter the physical address to get the zip + 4. A pain, but could you make the + 4 a required field for your shopping cart?


----------



## houseofwool

new12soap said:


> Wisconsin's Department of Revenue states that the 9 digit zip code (or "zip + 4) will give you the correct tax district, if you have that. If not you should be able to enter the physical address to get the zip + 4. A pain, but could you make the + 4 a required field for your shopping cart?




I probably can, but it means entering all of the permutations into the table ahead of time.


----------



## pamielynn

This is why they'll never get this online tax thing figured out. New York is "destination" based sales tax and for me, Texas is "origin" based sales tax. Eh, gads. It's just a mess.


----------



## Mellifera

pamielynn said:


> This is why they'll never get this online tax thing figured out. New York is "destination" based sales tax and for me, Texas is "origin" based sales tax. Eh, gads. It's just a mess.



I'm surprised and disappointed that a huge enterprise like PayPal doesn't figure the tax automatically for sellers. Yes, NY is a "destination" tax state, and counties and even cities can have different rates. NYC has a number of "special" rates depending on WHAT you're selling (luckily, that one doesn't effect me).


----------



## pamielynn

Mellifera said:


> I'm surprised and disappointed that a huge enterprise like PayPal doesn't figure the tax automatically for sellers. Yes, NY is a "destination" tax state, and counties and even cities can have different rates. NYC has a number of "special" rates depending on WHAT you're selling (luckily, that one doesn't effect me).



If the IRS wants it's money, they should make it a bit easier to figure out.
And yes, Paypal should be able to code that info into it's system.


----------

