Supremes Voted That States Allowed To Require Internet Sellers To Collect Sales Tax

Dealers at major shows generally must report and pay sales tax. While some dealers may not account for cash as carefully as others, most record every transaction or keep track of cash. States may allow reporting of "tax in gross", where sales tax is bundled into the price. Selling to other dealers is a gray area, because the state may require keeping a copy of sales tax registrations from wholesale buyers, but few enforce it. Another gray area is "discount postage". Some states may allow non-taxable "accommodation sales". Dealers "winging it" should worry about the IRS. If expenses are high relative to revenue, the feds may believe that some cash sales were underreported.

They don't have to record every sale, they only need a total which thy can get at the end of the day from cash at end minus cash at start plus of course checks (and credit cards if they take them)

from ebay:

Better to ebay have to do it than individual sellers. My biggest concern is that ebay won't CLEARLY display that the decision to collect sales tax is NOT that of the seller... or else buyers will be leaving negs for sellers thinking it's the seller's fault. Because, well... buyers.

This will be on my ebay sellers page .No sales to buyers in WASHINGTON STATE .Sorry don't want to deal with tax forms for a $10.00 sale and watch my accountant charge me $150.00 a hour to process all the forms for state and federal taxes . SORRY take your business elsewhere .

Uhh... if ebay is collecting and remitting the sales tax, why would you have to file anything? I don't understand.

Here's the full link to the ebay announcement - https://community.ebay.com/t5/Annou...a-p/28962962

"Once we start collecting tax in these states, you do not need to take any action. There are no extra charges or fees for this service. Prior to these dates, please continue to collect and remit tax in these states and comply with any other applicable requirements they impose.

There are no opt-outs for selling items into the states listed above, or out of ebay automatically collecting sales tax for items shipped to the states above.

Additional states will likely be added to the above list. Stay informed on the Help pages."

I'm sure every state that collects sales tax will be added at some point. As ebay said, sellers don't have to do anything and it will be automatic.

Floortrader: You won't have to block anyone from any state.

My question: What happens if a buyer contacts a seller and wants to pay via check, M.O. or cash? Sellers have the right to turn buys down or accept them at this point if asked, but what will ebay's action be to prevent buyers from paying taxes?

I think "kudos" to ebay are in order.

Stop the bit about ebay collecting and paying the taxes ......you are RESPONSIBLE . If your doing business YOU have to detail all state and local taxes collected and paid . I want records showing the state received my payment not some third party statement that says 50 million collected and 48 million paid out to the state .Remember ebay is a service and if they get into the tax collection business ,than other services could beat have buyers paying 6 or 9% less if they buy on that other site .

Presumably the seller is responsible for collecting and remitting sales tax if not paid through ebay.

For simplification purposes, I can easily see non-eBay payment forms being banned entirely.

floortrader: You're not going to have a choice in this matter. It's ebay that's in control of it. If you don't like it, well there's other venues.

I'm a bit frustrated by this announcement from ebay, since it means buyers will be paying tax on transactions with me (and it's going to result in lower realizations for me). Here's the thing: even in PA, WA and OK, as I read it many of us (including me) don't hit the reporting threshold (sales of 10k, or a certain number of transactions). The states are taking the position that *ebay* is the seller, so they are able to collect tax on transactions they otherwise wouldn't get.

paperhistory, I was thinking about that same thing, but from a different angle. In the past, ebay always hid behind the claim that they're "only a venue"; they can't possibly be held liable for any bad that happens because they only provide the platform - caveat emptor!

But the more they keep acting like a seller, e.g. setting/requiring certain terms of sale, requiring the use of their catalog, collecting and remitting sales tax, etc., the less likely that stance will continue to protect them.

Hopefully, this latest stupidity will lead to better user vetting, a meaningful feedback system, etc. If they want to be the merchant of record, then they should get all the responsibilities (and liabilities) that go with it... is your law firm interested in filing a couple class action lawsuits on the (real) sellers' behalf?

The ebay decision potentially levels the playing field for sellers in more populous states who must collect sales tax on in-state sales. Forgoing the privilege of calculating the Byzantine Washington State destination-based sales tax by changing the status of ebay transactions to "Wholesale" will not be a burden. Some jurisdictions are further split by the regional transit district (RTA) boundaries requiring each individual address to be checked. Buyers with post office boxes will would not be charged the correct tax unless they divulge their street address. Will Washington State limit collection of the infamous Business & Occupation (B&O) surcharge to in-state transactions?

Will ebay correctly exempt wholesale purchases by buyers with a state tax ID? How would purchases for resale be distinguished from other purchases? I am not confident that ebay has any ability to intelligently address these issues. Clumsy suppression of titles containing words like "Cuba" suggests that ebay will handle ambiguous situations with a one size fits all approach and collect sales tax for exempt sales, burdening buyers with recovering misapplied tax amounts.

In my opinion, ebay's handling of financial coding is far different than its handling of due diligence compliance coding.
Don