Collecting sales tax

jachang · May 10, 2010

If a customer orders prints or merchandise from my SmugMug account, is the "seller" SmugMug or me? I'm not sure about the sales tax. In my state, if the vendor does not have a place of business within the state, then there is no sales tax. So I think it depends on who is technically the seller? What shows on the customer's credit card? SmugMug or me? In my few sales so far, I have ordered the stuff myself, had it shipped to me, then I sold it, so in that case it looks like it is taxable, but if they order it themselves is it taxable? I was looking at someone else's site and they said since you're not technically the seller, then there's no tax.

Thanks,

Jean

Andy · May 10, 2010

We are the seller - so we collect and remit tax to the State of CA for CA orders. If you determine that you must pay sales tax on your orders, you can use add that in to your orders. Here's our help page that explains it: http://www.smugmug.com/help/photo-sales-tax - holler with any questions!

jachang · May 10, 2010

Andy wrote: »

We are the seller - so we collect and remit tax to the State of CA for CA orders. If you determine that you must pay sales tax on your orders, you can use add that in to your orders. Here's our help page that explains it: http://www.smugmug.com/help/photo-sales-tax - holler with any questions!

Hi Andy,

Okay, I think I've got it. If someone orders directly from my SmugMug page, and they don't live in California, they don't get charged sales tax. If I order it, I don't pay sales tax because I'm not in CA, but then if I resell it in my own state (MA) I do charge MA sales tax to the buyer.

Is that it?

I guess I have to go change my info in the Control Panel because I have it set to collect MA sales tax.

Thanks,:D

Jean

SamirD · May 10, 2010

It's going to be important for you to check your state, county, and city ordinances for the info. This varies wildly from state to state.

When I had a business distributing automotive parts, even companies shipping to my state from out of state had to remit taxes for the state, county, and even city. I believe this would even apply to SM if the items being sold are considered taxable by the ordinances and statues.

BlueSlate · May 10, 2010

Hmm...I figured that if someone orders from my smugmug page and they live in PA they would have to pay sales tax since I am based in PA. I know the actual prints are being made by smugmug and they are in CA so....very confusing.

dave351 · May 10, 2010

BlueSlate wrote: »

Hmm...I figured that if someone orders from my smugmug page and they live in PA they would have to pay sales tax since I am based in PA. I know the actual prints are being made by smugmug and they are in CA so....very confusing.

Hello, I'm new to the SmugMug community and I wanted to add my thoughts & experience to this topic (for better or worse lol).

I had a discussion with my accountant about sales tax, and we decided that my photography is a service (which is not taxable in my state) rather than a product (which is taxable in my state). When a customer orders prints from me, they are actually purchasing the prints directly from the printer and I am merely acting as a middle-man in delivering those prints from the printer to the customer. If there happens to be a mark-up on the prints, then that is my service fee for processing the images.

Long story short... it was his opinion that I do not need to charge sales tax for my "service". If the customer chooses to declare the unpaid sales tax on their tax return on April 15, then that's between them and the state (it would be similar to their purchasing an item from any other online retailer).

Obviously, there are a lot of variables... state laws, your "company's" legal status, your accountant's leniency with the tax laws, etc (that last one was an attempt at a joke). Not trying to muddy the waters, but if you can get away with not worrying about sales tax, it might make life a little easier.

Collecting sales tax

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