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> Charge Sales Tax On Billing Or Shipping Address?
danilyn22
post Aug 10 2007, 12:52 PM
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I tried searching for this issue on this forum but since the word "tax" is 3 letters or less I could not perform the search. First let me b*tch about that. There is many a legit word that is 3 letters or less that we should be able to search for LIKE TAX...

Anyway... What is the general assessment. Should we tax on shipping or billing address. I am in California. Also, where is that setting?
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agkits
post Aug 10 2007, 01:15 PM
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QUOTE
There is many a legit word that is 3 letters or less that we should be able to search for LIKE TAX...


? ... I got what you mean. lol bigsmile.gif ....It sucks we cant search 3 letter words. I usually use say some 4 letter words when I get...

QUOTE
One or all of your search keywords were below 4 characters or you searched for words which are not allowed, such as 'html', 'img', etc, please go back and increase the length of these search keywords or choose different keywords.


I'm in the same boat. (NY) here. General assessment is we are screwed.....stuck with what we have.... need third party help...... But we can upload bulk zipcodes in dataport! .....doesn't that help? ..... bash.gif (sense the sarcasm?)

Justyn

This post has been edited by agkits: Aug 10 2007, 01:16 PM
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BamaCat
post Aug 10 2007, 02:49 PM
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You tax on shipping address. I live in Florida, and a couple weeks ago called dept of taxation to make sure. I asked "what if a Florida resident buys a product and ships it to Virginia or any other state? No sales tax is charged. If a Delaware resident (a no-sales tax state), or any other state for that matter, buys something and sends it to Florida, they are charged FL tax and I must report it to the state of Florida. However, you should check with your state just to be sure.

Go to Checkout >> Checkout Settings >> Charge Tax Based on Billing or Shipping Address

I think CA is like FL where they have a general state sales tax rate and then counties and localities have their own tax rates as well. The state of CA should supply you with a list of the tax rates for these locations. However, you can't apply them in this software. I'm pretty sure I saw that option in the soon-to-be-released new software.
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macrick
post Aug 10 2007, 04:03 PM
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QUOTE(BamaCat @ Aug 10 2007, 05:13 PM) *
You tax on shipping address. I live in Florida, and a couple weeks ago called dept of taxation to make sure. I asked "what if a Florida resident buys a product and ships it to Virginia or any other state? No sales tax is charged. If a Delaware resident (a no-sales tax state), or any other state for that matter, buys something and sends it to Florida, they are charged FL tax and I must report it to the state of Florida. However, you should check with your state just to be sure.

Go to Checkout >> Checkout Settings >> Charge Tax Based on Billing or Shipping Address

I think CA is like FL where they have a general state sales tax rate and then counties and localities have their own tax rates as well. The state of CA should supply you with a list of the tax rates for these locations. However, you can't apply them in this software. I'm pretty sure I saw that option in the soon-to-be-released new software.

Don't want to argue with you Bama, I know the tax people in florida told you, but what they told you makes no sense.

We charge tax on the billing address. After all, who are you selling it to? I know this isn't the situation all the time, but say Joe in Fl buys Bob in CA a gift and ships it to Bob in CA, why in the world would you charge CA tax to Joe in FL? Technically, the point of sell is in your office in LA, but not really, because your web server is in WA. Narrowing down the POS is technically difficult. Your server? His ISP? What if he is Traveling?

We find it easier to say the point of sale was where the person bought it, ON his computer, which most likely is his billing address, (sure he may be traveling) which is located in this case in FL, we are in LA, don't collect sales tax for FL, so Joe pays no sales tax.

Why in the world would FL sales tax people tell you that if someone in FL bought something from you a merchant in FL and shipped it to any other state, that FL wouldn't want the Sales Tax, that makes no sense in the world. A FL merchant sells something to a FL resident, HELLO, I don't care where you ship it, FL to FL, $$$ for Roads, Schools, Voting Machines, Sand for the Beach, etc. . . .

This post has been edited by macrick: Aug 10 2007, 04:04 PM
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BamaCat
post Aug 10 2007, 07:31 PM
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Voting machines only seem to be a problem when democrats get to them. Apparently it's not so easy to follow a huge bold arrow pointing to the name of a candidate! Until you find out your candidate didn't win, that is. happy.gif

I suggested Justyn check with CA because each state will be different but there are 4 potential scenarios we're talking about here:

1) If someone with a billing address in your home state of business buys a product on your website and ships it to another state, do you collect sales tax?

From the Florida Sales and Tax Use Guide for businesses: "Sales tax dealers are responsible for determining if a transaction is taxable or exempt. All sales of tangible personal property to your customers are taxable unless the items are specifically exempt from tax; shipped out of state by you; or customer presents a valid Consumer's Certificate of Exemption......"

2) If someone with billing address out of state buys from your website and ships to another person out-of-state, do you charge tax?

Based on scenario #1 the answer is no.

3) If someone with a billing address in your home state of business buys from you online and the shipment is shipped within your home state, do you charge tax?

Of course, that's pretty obvious.

4) If someone with billing address out of state buys something and ships within your home state of business do you charge tax?

This also seems strange to me. I'm going to call Monday, again, just to make sure, but I was told this in person when I was handed my business license and I called the dept of finance in Tallahassee at least once after that to make sure. But you never know, there's bad info everywhere. That's why I suggested Justyn contact his state to make sure.

But it doesn't matter where your web server is or where the person is, you didn't get a business license in the state in which your web server resides or in the location the person using the computer to order your product is. You get a business license in the state in which you do business and reside. What doesn't make sense is charging tax based on all 50 states. Who does that tax go to? Sounds like you should be sending that tax $ to each of the other 50 states for all products purchased by people living (billing address) in each individual state? Or do you collect 50 different sales taxes and give it all to your home state? Then how do you figure the county, city or other sales taxes for every state?

Being an online company and a home based business is a different animal than a brick an mortar store where people walk in and buy stuff right there. And until the politicians figure a way to tax us more, (and they are always thinking of ways) they will continue to be confused on how to suck more money out of us. Although many website merchants also have brick and mortar stores so the laws are probably different for them.

Like I said, I'll call Monday and give them these scenarios and see what they say.
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macrick
post Aug 10 2007, 08:00 PM
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LOL on the voting machines.

Best advice is the one you gave him, check with your state, it is different state to state, and yes, its a mess. We base ours off of Billing Address.

QUOTE(BamaCat @ Aug 10 2007, 09:55 PM) *
Voting machines only seem to be a problem when democrats get to them. Apparently it's not so easy to follow a huge bold arrow pointing to the name of a candidate! Until you find out your candidate didn't win, that is. happy.gif

I suggested Justyn check with CA because each state will be different but there are 4 potential scenarios we're talking about here:

1) If someone with a billing address in your home state of business buys a product on your website and ships it to another state, do you collect sales tax?

From the Florida Sales and Tax Use Guide for businesses: "Sales tax dealers are responsible for determining if a transaction is taxable or exempt. All sales of tangible personal property to your customers are taxable unless the items are specifically exempt from tax; shipped out of state by you; or customer presents a valid Consumer's Certificate of Exemption......"

2) If someone with billing address out of state buys from your website and ships to another person out-of-state, do you charge tax?

Based on scenario #1 the answer is no.

3) If someone with a billing address in your home state of business buys from you online and the shipment is shipped within your home state, do you charge tax?

Of course, that's pretty obvious.

4) If someone with billing address out of state buys something and ships within your home state of business do you charge tax?

This also seems strange to me. I'm going to call Monday, again, just to make sure, but I was told this in person when I was handed my business license and I called the dept of finance in Tallahassee at least once after that to make sure. But you never know, there's bad info everywhere. That's why I suggested Justyn contact his state to make sure.

But it doesn't matter where your web server is or where the person is, you didn't get a business license in the state in which your web server resides or in the location the person using the computer to order your product is. You get a business license in the state in which you do business and reside. What doesn't make sense is charging tax based on all 50 states. Who does that tax go to? Sounds like you should be sending that tax $ to each of the other 50 states for all products purchased by people living (billing address) in each individual state? Or do you collect 50 different sales taxes and give it all to your home state? Then how do you figure the county, city or other sales taxes for every state?

Being an online company and a home based business is a different animal than a brick an mortar store where people walk in and buy stuff right there. And until the politicians figure a way to tax us more, (and they are always thinking of ways) they will continue to be confused on how to suck more money out of us. Although many website merchants also have brick and mortar stores so the laws are probably different for them.

Like I said, I'll call Monday and give them these scenarios and see what they say.

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EQPosts
post Aug 11 2007, 09:51 AM
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Each state is different with how they require business to pay tax. For Wisconsin an individual who has a billing address within Wisconsin will pay the Wisconsin state tax. All county tax is only charged if we have a physical presence or retail store in that county or happen to be selling in that county at an expo or trade show. Our physical corporate office is located in Wisconsin but not in any other State. We do not have to charge other states sales tax because we physically are not driving our own vehicles to deliver the products to our customers. We use a third party to deliver the products (UPS, USPS, FedEx) and are not required to charge other state tax unless we personally deliver the product to our customer with our own company vehicles or have a presence in that state.

That is why we charge sales tax on billing address because it is based on who is paying you for the item not where the item is shipping to.

This post has been edited by equickxpress: Aug 11 2007, 09:52 AM
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ddowhy
post Aug 14 2007, 09:52 AM
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You only charge sales tax if the state you are shipping to is any state in which your corporation has a presence. Ie, my business is registered and resides in NJ. I only charge sales tax for any sale that ships to NJ. Otherwise, according to current tax laws, the 'customer' is supposed to 'keep track' of sales tax owed for any items purchased over the net that were not taxed and must pay that tax to their own state accordingly. This is currently not enforced, as it would be practically impossible to anyway, so basically that is why most purchases on the net are 'tax-free'.
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nobbies
post Aug 14 2007, 10:40 AM
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Sales tax is a big pain bash.gif

We have multiple retail stores in 2 different states. 2 in Nebraska and 1 in Iowa. I ship out of one of our Nebraska locations only. According to Nebraska and Iowa tax departments, when we ship in Nebraska, we charge state tax plus any additional sales tax the individual towns or cities charge. So I have a list of 50 towns/cities in the state of Nebraska that get charged additional sales tax on top of the state charge. But if I ship to Iowa, all I have to charge is the flat state percent. And if I ship outside of those two states, no sales tax.

Sorry just needed to rant!

Nothing like consistent government regulations. huh.gif
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ddowhy
post Aug 14 2007, 06:39 PM
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Most state's tax/revenue web site spell out that it's the 'purchasers' obligation to pay sales tax when buying something from the internet thats from another state.

For example, Pennsylvania's:
Taxpayers are personally responsible for remitting the Use Tax directly to the PA Department of Revenue. Purchases made over the Internet, through toll-free numbers (800, 888, and 877), from mail order catalogs or from an out-of-state location are examples of purchases that would be subject to Use Tax.

Some examples of Sales and Use Tax evasion:Collecting Sales Tax in the Commonwealth without a valid license.
Not paying the Sales Tax collected to the Department.
Not filing a Sales and Use Tax return with the Department.
Underreporting the tax collected to the Department.
Filing a false tax return.
Buying something over the Internet or in another state and not paying Pennsylvania Use Tax.

So, as you can see, it is upon the purchaser to pay sales tax (or Use tax in this case), when the purchase was made over the net from a different state.
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BamaCat
post Aug 15 2007, 07:27 AM
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ddowhy said it perfectly, I just called state of FL to make sure and the only time I charge tax is if it's shipped to florida. Even if someone with a Florida business address buys something, as long as it's shipped outside the state of Florida, I don't charge sales tax. It then becomes the responsibility of the purchaser to pay the appropriate sales tax, which of course, they never do.

But every state is different, and must be verified with that state. This system actually makes it much easier on us, the merchants, I'd hate to have to figure out sales tax for all 50 states and pay all those states their tax every quarter.
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etrimmings
post Aug 21 2007, 03:25 PM
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question on physical NY location tax.
I sell online only and its my only physical location. So I basically just tax whoever purchases from NY correct? btw, I just checked the sales tax rate for NY from taxadmin.org and said sales tax is 4%. Can anyone from NYC confirm this?

thank you.
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Ribbon People
post Aug 21 2007, 04:10 PM
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I was refered to this by our local BOE office: http://www.boe.ca.gov/pdf/reg1822.pdf

State of California
BOARD OF EQUALIZATION
TRANSACTIONS (SALES) AND USE TAX REGULATIONS
Regulation 1822. PLACE OF SALE FOR PURPOSES OF TRANSACTIONS
(SALES) AND USE TAXES.
Reference: Sections 6012.6, 6015, 6359, 6359.45 and 7263, Revenue and Taxation Code.
Auctioneers, see Regulation 1565.
Vending Machine Operators, see Regulation 1574.
(a) IN GENERAL.
(1) RETAILERS HAVING ONE PLACE OF BUSINESS. For the purposes of the Transactions (Sales) and Use
Tax Law, if a retailer has only one place of business in this state, all California retail sales of that retailer occur at
that place of business unless the tangible personal property sold is delivered by the retailer or his or her agent to an
out-of-state destination, or to a common carrier for delivery to an out-of-state destination.





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