Good Day Passed. eBay started collecting sales tax for some states

I am tired of seeing brick and mortar stores drying up. Online sellers already have an advantage of lower overhead and then you ad no tax of 6-9 % it really hurts them. Maybe we will start to see more of the mom and pop stores flurious.
 
So, if someone buys your amp in one of those states will it be reported to the IRS and have to be included when you file ?
Most states, including Arizona, have what is called a Use tax - You’ve made an out of state purchase for a new product, you’re the end user, and you’re liable. By law, you must report this come tax time and pay Use tax on it (typically the same rate as sales tax).

I’m sure you guys all do that, right?
 
Every state that has a sales tax also requires taxpayers to pay up when they buy something that they don't pay sales taxes on. It turns out most taxpayers aren't honest about their out-of-state purchases. So states have to raise their sales taxes even more on transactions where they can collect.

Internet sales were exempted from sales taxes for many years to help Internet commerce grow. But these days so much of total sales is done on the Internet that states are going broke while Internet sellers (like Amazon and Ebay) put more and more local stores out of business.

Congress finally allowed states to collect sales tax on all Internet sales (and not just those where the online retailer had a physical location in the state). I don't like paying taxes any more than others. But given how much extra New Jersey has always paid to the Federal government in income taxes (NJ and California always subsidize a bunch of states that always take more than they contribute), I'd prefer everyone pay the legal sales tax so my other state taxes don't have to go up even more.
 
Most states, including Arizona, have what is called a Use tax - You’ve made an out of state purchase for a new product, you’re the end user, and you’re liable. By law, you must report this come tax time and pay Use tax on it (typically the same rate as sales tax).

I’m sure you guys all do that, right?


I'm talking about the individual seller from any state reporting income. Say you sell a few items each year, will this now be reported when it's bought in these states. (I'm also sure everyone reports their garage sale income too)
 
Slightly?
Pennsylvania sucks you dry. Highest gas tax in nation, too.

Yeah man, I had a 2 paragraph tangent worked up over this, but decided to resort to sarcasm. It's actually exceptionally irritating.

I thought for the sake of not getting the thread closed, I'd keep my peace.
 
Slightly?
Pennsylvania sucks you dry. Highest gas tax in nation, too.

I thought California had it bad so I did some fact checking and you are right. PA has CA beaten by a few cents a gallon. However, California is blessed with what is called "summer blend" gasoline which for some reason is in short supply and therefore more expensive.
 
From what I hear, ebay used to not charge their fee on free shipping. Die hard sellers figured this out, and sold their goods dirt cheap, but jacked the shipping costs up to avoid the fees. Worked for awhile, until ebay saw too many people doing it, and the rules changed.

I already know a way around this sales tax issue if it happens. But, it will only be a matter of time before enough people do it and the rules will get changed again.

Besides, the seller doesn't pay the sales tax - they buyer does. Doesn't affect me as a seller, except for reporting, which I already do in my business.
 
Wow - I actually had no idea about this.

It'll be interesting to see how this effects the overall eBay market - there's already a "convenience tax" and "eBay sellers fee tax" that seems to inflate the prices of gear on there compared to a local sale. But now it might be a bit tougher for sellers to get buyers from the tax liable states to pony up the same amount of cash as before - at least for the expensive gear, such as the rare and sought after monster Sansuis and such.

I prefer to buy locally anyways, but eBay has definitely helped me track down some rare goodies too.
 
So, if someone buys your amp in one of those states will it be reported to the IRS and have to be included when you file ?

I doubt it. Ebay will collect and distribute the taxes for those states totally separate from the seller, so the seller's sales will be lost in a plethora of all sales shipped to said state. Plus this has nothing to do per se with the IRS, as that is a federal organization and has nothing to do with state taxes.

That being said, I have always reported my eBay sales on a Schedule C as well as any expenses, including parts, repairs, fees, and mileage. I sell a decent amount and have only received a 1099 from Paypal once, but regardless I have filed Schedule Cs for years.

For a couple hundred bucks, I wouldn't be too concerned; there's bigger fish out there...
 
Just had a sale to Washington state. Ebay charged and collected sales tax. Doesn't even show up in my paypal account.

What's funny - right after that, I had a sale to California. I have to collect sales tax myself - but not ebay.
 
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