Sales Tax

StudioVoxPop

Hi there--

I'm trying to start an in-home Portrait Photography side business. If I do a shoot with a client, do I need to charge him/ her sales tax? How do I report that? Any thoughts or referrals to resources would be appreciated.

Justin

~Jan~

Yes, you will charge sales tax on prints. Whether or not you do so on session fees varies by state (here in Illinois you do not pay sales tax on session fees). You will need a tax ID to charge sales tax--talk to your courthouse.

J.T.

StudioVoxPop wrote:

Hi there--

I'm trying to start an in-home Portrait Photography side business. If I do a shoot with a client, do I need to charge him/ her sales tax? How do I report that? Any thoughts or referrals to resources would be appreciated.

Justin

Justin, I went through this similar situation here in CA when I found out that my local city required that I apply and pay for a local business license as well as a home business permit even if I don't do any type of photo shoots in the house.

I found some helpful information on the web at my state's franschise tax board and the county treasurer / tax office to start with. You'll find more links from them for additional information.

There is a dgrin thread out there if you search the forum that has a lot of helpful information on this type of stuff too.

Good luck!

StudioVoxPop

~Jan~ wrote:

Yes, you will charge sales tax on prints. Whether or not you do so on session fees varies by state (here in Illinois you do not pay sales tax on session fees). You will need a tax ID to charge sales tax--talk to your courthouse.

Thanks for this. I'm curious about session sales tax. I'm in California. Anyone have experience with this in CA?

Justin

ChatKat

Yes...

StudioVoxPop wrote:

Thanks for this. I'm curious about session sales tax. I'm in California. Anyone have experience with this in CA?

Justin

Accountant and QuickBooks Consultant by day....Also make sure you get a business license for your city or you will get caught for not having one!

http://www.taxes.ca.gov/Sales_and_Use_Tax/SellersPermit.shtml

Angelo

StudioVoxPop wrote:

Hi there--

I'm trying to start an in-home Portrait Photography side business. If I do a shoot with a client, do I need to charge him/ her sales tax? How do I report that? Any thoughts or referrals to resources would be appreciated.

Justin

Hey Justin:

The correct answer depends on several factors, not the least of which is your state of residence, which is not evident in your profile or your website.

In California, sales tax issues are regulated by the State Board of Equalization. The typical rule of thumb in CA is you must collect sales tax whenever an exchange of tangible goods takes place. So while sales tax may not be required on your services, they will be as soon as you turn over a CD or prints to the client.

The issues of sales tax are complex and also legally avoidable if you do not conduct the actual sale of images yourself.

(ps: excellent images on your site)

StudioVoxPop

Angelo wrote:

Hey Justin:

The correct answer depends on several factors, not the least of which is your state of residence, which is not evident in your profile or your website.

In California, sales tax issues are regulated by the State Board of Equalization. The typical rule of thumb in CA is you must collect sales tax whenever an exchange of tangible goods takes place. So while sales tax may not be required on your services, they will be as soon as you turn over a CD or prints to the client.

The issues of sales tax are complex and also legally avoidable if you do not conduct the actual sale of images yourself.

(ps: excellent images on your site)

Hi Angelo,

Thanks for your response. Yeah, I obviously need to do some more digging around and research. I am in CA so I'm sure I'll be spending some time on the BOE website!

My plan was to shoot portrait sessions and then let my clients access their images in a private gallery which would allow them to order prints from SM. I doubt giving them access to their images would constitute an exchange of goods if no physical object is changing hands. I'm still unclear if I need to tax them on the price of the actual shoot, though, and that's what I need to research further.

Thanks again for reading...

Angelo

StudioVoxPop wrote:

Hi Angelo,

Thanks for your response. Yeah, I obviously need to do some more digging around and research. I am in CA so I'm sure I'll be spending some time on the BOE website!

My plan was to shoot portrait sessions and then let my clients access their images in a private gallery which would allow them to order prints from SM. I doubt giving them access to their images would constitute an exchange of goods if no physical object is changing hands. I'm still unclear if I need to tax them on the price of the actual shoot, though, and that's what I need to research further.

Thanks again for reading...

If you direct your clients to your SM site you can stop worrying about sales tax!

chuckinsocal

The Franchise Tax Board has a whole section about sales tax in the photography industry on their web site. It's the most convoluted thing I've ever seen but I'm sure the answers to all your questions are in there somewhere.

Chuck Cannova
www.customrideportraits.com
http://chuckinsocal.SmugMug.com

StudioVoxPop

chuckinsocal wrote:

The Franchise Tax Board has a whole section about sales tax in the photography industry on their web site. It's the most convoluted thing I've ever seen but I'm sure the answers to all your questions are in there somewhere.

Chuck Cannova
www.customrideportraits.com
http://chuckinsocal.SmugMug.com

Hi Chuck,

Thank you for this-- I did a search on the Tax Board website and I can't find it. Can you direct me to it?

Justin

chuckinsocal

I think I misspoke ... I think I meant the State Board of Equalization. I always get those two mixed up. Sorry 'bout that.

Chuck Cannova
http://chuckinsocal.SmugMug.com
www.customrideportraits.com