Ecommerce sales tax | When do sellers need to collect?

[@longbeach225]

The US needs a tax rehual. There is no need for taxes to be this complex.

[@andreaisabel1995]

It’s incredibly ridiculous

[@BoxerDogs]

Yes that's right. The reason why it's so complicated is because the political prostitutes try to make it look like they're doing something. Not only that, they always want your money.

[@bobbg9041]

Flat 7.475% tax. Collect on everything pay to one government office who gives it to the states items were sold to who in turn devieds it to localities. In my city, we have about 15 tax locations or districts its split into 3 counties you do the math but how many locations are in each state, how many cities whats the local tax liability, how many states? You might think a computer program, but one vote can make it outdated. Its too much shit to deal with for a small business and difficult at best for a large company like Amazon. Flat tax. Register with just them And let retailers do what they do best Makes sales and ship products.

[@nannieanncreates4472]

@@bobbg9041 I’m in California and last time I checked we have over 200 individual county tax rates. Then there are individual city/town tax rates. As a new business just starting out I honestly have no idea where to start I can’t seem to find an easy to understand way to deal with all of this!

[@YoTeezy]

I agree coming from Africa this is a head ace they r crzy. It is too much..

[@christiansantillanes]

I'm so mad that school never taught us the complexity of taxes.

[@benjaminfreeman1418]

yeah I never knew it.

[@joycelychanel5331]

That's right I went school for business just because want to learn about tax but no clue, they only teach what I dont really need

[@xMaddieMuffin]

Subjects are 45 minutes on, theres only so much high school can teach you. I’d be more mad your parents didnt teach you.

[@markoceki]

Take ownership and learn that shit. No good in complaining about what school never taught us. Forget that rainbow fish and start learning what matters lol

[@AH-sc8be]

So if my extremely small business isn't hitting any of the "items sold" or "income" thresholds for the states, I only have to collect for the state I have nexus (live) in?

[@LedgerGurus]

Yes, that is correct. Also keep in mind other ways you'd have "physical nexus". For example, if your inventory is stored in any other states, you have employees in other states, etc. This is usually unlikely for small sellers unless they use Amazon FBA.

[@blacksea7171]

This might sound like a stupid question but if I’m in California and I’m shipping to for example a customer in Florida and I have no Nexus with Florida do I charge the California tax still? Or do I charge California tax and Florida tax?

[@LedgerGurus]

You only charge sales tax to customers for the state they live in. And you don't need to charge sales tax until you have nexus in a state. We just did a webinar going through the entire process of sales tax. I think you'll find it valuable. Here's the link to watch it on-demand - ledgergurus.com/resources/sales-tax-course-updates/

[@hermanlacc7730]

If I have an online business in California from home and will be shipping from California to other states. Do I have to charge taxes for the states I ship to?

[@LedgerGurus]

Hi Herman. If you do not have nexus in these other states, you don't need to collect sales tax. Just make sure to watch economic nexus thresholds. When you reach a certain number of sales in states you ship to, then you'll need to start collecting in those states: ledgergurus.com/blog/ecommerce-sales-tax-and-economic-nexus/

[@LeoLandaverde]

Very informative video! This is always a very technical and often misunderstood area of business. Great content.

[@LedgerGurus]

Thanks for the feedback!

[@mishelltorres7078]

So I wanna open an online boutique in Oregon, and theres no sales tax here, I would be shipping from my home. Do I just track my sales and if they ever get over 200 transactions or 1OO,OOO in a certain state I start to charge sales tax and have to register in that state? Or do you charge sales tax since day one. Thanks in advanced! Im very confused.

[@LedgerGurus]

This is correct. Be aware that states do have differing thresholds of transactions and/or sales. But generally when you are approaching 200 transactions or $100K in a state, you'll want to check their economic nexus laws. When you do have sales tax obligations in a state, just make sure you register for a sales tax permit before collecting sales tax from customers. For more help, you can download our sales tax guide here: ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@bobbg9041]

No. Its differnt in every state now. Its a total cluster fuc*

[@thatguywiththe]

This whole system needs to be overhaul, it's like you need a degree in taxes to be able to keep your business functioning. Great video, very informative.

[@LedgerGurus]

We agree. Sales tax is unnecessarily complicated and burdensome - especially for ecommerce.

[@emijcallister]

Hi, I want to open a Shopify store where I will be selling goods online and shipping them within the u.s. I live in Utah and Utah’s nexus is if you have a physical presence in Utah, sell $100,000 or more, or have more than 200 transactions. I will be selling items from my house so does that mean I reach the nexus guidelines? And also when I am charging sales tax Will I only charge sales tax if I sell to someone in the same state as me? Or will I charge the sales tax of Utah to every state? Or will I charge different sales tax for each State? I am really confused and haven’t quite found the answer I am looking for online. Thank you!

[@emijcallister]

It sounds like I have a physical nexus in Utah so do I start charging Utah sales tax to people that purchase who live in Utah and purchase from Utah? Or do I wait till I hit both physical/economic? Or do I not worry about either until I hit 200 transactions.

[@LedgerGurus]

@@emijcallister hi! You will need to charge utah tax to customers in utah from your very first transaction because you are physically located in utah. For other states’ customers, don’t charge sales tax until you pass the economic nexus threshold in other states and that you’ve registered in those states.

[@suzil7687]

Liked & Subscribed - Got turned on to you by our bookkeeper. We're swimming in nexus questions- why is this so hard!!!?!?!? Ok, I"m reading the PDF and will click on all the links and watch as many vids as possible. Then I'll reach out to you for help! Thank you for creating and sharing this content - super helpful and very supportive.

[@LedgerGurus]

Yes it's definitely confusing. Feel free to reach out if you have any additional questions.

[@RoxiieSays]

Hi! Awesome video! Our business is registered in Maryland and we have a MD sales tax ID. But we also plan to package and ship orders from NY. Do we need to register for a sales tax ID in NY as well? We’re just starting and the business is very small so we’re just a bit confused. Thanks for your help!

[@jenniferwick2772]

I believe you do since that would also count as a physical nexus. I would talk to your accountant to make sure you're doing everything correctly from the start. I'm in the same boat as I'm starting up an online shop and will be drop shipping a few items from another state. Good luck!

[@ecombalance3501]

Understanding the concept of Ecommerce sales tax and how it works is VERY complicated, but you were able to simplify it for beginners. Thank you!

[@LedgerGurus]

You're very welcome! Glad to help. :)

[@maryd9735]

Thanks for this video. I’m about to start my very small online business. And I plan to sell worldwide because basically any one from around the world can click and buy. From the explanations you gave, 1. If someone buys my product from any of the US states I do not have to charge them for tax neither do I have to pay tax right as long as I have not hit the threshold ? 2. I will be operating from one of the Canadian provinces, let’s say Ontario for example, I only need to charge buyers for taxes in Ontario and not other provinces ? 3. Before one can charge a tax, you must have a legal permit to do so right ? so basically it’s not like you can just input 5 % for example of total price of good the customer bought because you know for example the province you operate from charge 5% tax 4. Does one need to register the business even though very small first before selling at all? Sorry for the many questions

[@LedgerGurus]

Hi Mary, here are our responses: 1. That is correct. You most likely will only need to register and collect in states where you have a physical presence (inventory stored, where you are located, employees hired, etc) or where you have economic nexus (the annual sales or transactions thresholds) 2. This video only applies to US sales tax. We don't handle sales tax outside the US. 3. Yes, you need a legal permit. Any sales tax collected is the state's money. You are liable to remit that to the state, and therefore legally cannot collect unless you have a permit to do so. 4. Here's an article on the benefits of registering your business; www.oberlo.com/blog/how-to-register-a-business

[@eliang03]

Hi, thank you for this helpful video! If I am starting a ecommerce business and shipping products from my own home in Massachussets, do I need to register and collect taxes from Mass? Do I have to keep track of my sales volume by state when I get bigger to determine my nexus one by one?

[@LedgerGurus]

Yes, you'll need to register, collect, and remit sales tax for Massachusetts sales. Then you will want to track sales volume by state as you grow to determine your economic nexus. There still may be other ways you have nexus in states, but economic nexus is one of the most common.

[@RoxiieSays]

Hi! Awesome video! Our business is registered in Maryland and we have a MD sales tax ID. But we also plan to package and ship orders from NY. Do we need to register for a sales tax ID in NY as well? We’re just starting and the business is very small so we’re just a bit confused. Thanks for your help!

[@LedgerGurus]

If you have inventory in NY, then yes, you do need to pay sales tax there. To get a better idea of how nexus works, download our free PDF "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business" - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@evelynleonoliveira-empresa8005]

Hi, thank you for your videos, we are creating a new Ecommerce Business, based only in Virginia, this means that I will not collect taxes when I sell to other States? The tax should be determined by the ship to address and I won't paid taxes in Virginia or New York, if I ship to NY for example? did I understand correctly?

[@LedgerGurus]

Yes. You only need to register for a permit and collect sales tax in states where you have nexus. And sales tax is determined by the Ship To address when being shipped from out of state.

[@FoodBizSuccess]

This is such a great video! You are very helpful. Can you answer this question for me please? I am an product Ecommerce business in a destination state as my only nexus and I sell nationwide. Do I only do destination tax collection and remitting for my current state or all states that have destination tax designation?

[@LedgerGurus]

You only need to register collect and remit sales tax in the states where you have nexus. In your case it’ll be your home state and other states if you pass their economic nexus threshold. Destination means the rate you are collecting should be determined by the ship to address instead of ship from address, it doesn’t have much to do with nexus :)

[@jennykim9946]

If I am dropshipping and my LLC is registered with the state I live in (Arizona) with a PO Box do I need to collect sales tax?

[@LedgerGurus]

Hi Jenny, you are liable to collect and remit sales tax for Arizona sales in your situation. Outside if Arizona you should not have to worry about sales tax until you get a significant volume of sales in other states.

[@JohnWick-uv2yz]

Is there a sales you have to collet if your customer is not living in the US? For example you sell a t shirt to someone in france, and if so would you pay it to your home state or the federal government?

[@LedgerGurus]

There is not any sales tax that you would owe to your home state or the federal government for international sales. Keep in mind other countries may have sales tax law laws that you would need to follow. But we do not specialize in this area of international sales tax.

[@Letishamalakootiofficial]

If I am based in Australia and using print on demand services to sell worldwide,what must i do? I have not sold anything yet, launching ads once i know the answer to this. The POD suppliers have warehouses in over 90 countries and predicting where a product will be shipped from, depends on where the customer is located, and what the closest facility is. Much appreciate your time

[@LedgerGurus]

I can't comment on other countries because we only do US-based sales tax, but I can tell you that a good place to start for US sales tax is to download our PDF "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business." It'll give you a good basis in what to expect here - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@chrisdouglas9978]

I can't believe you used such an important topic and addressed absolutely NOTHING throughout the entire video. At least, you should tell me "when do I need collect sales tax".....

[@LedgerGurus]

Hi Chris, sales tax is quite complicated. As the video describes you'll need to collect register for a sales tax permit and collect sales tax for sales in states where you have a physical presence (you reside, business is registered, inventory is stored, etc.) or a lot of economic activity. When you reach $100K in annual sales in a state or 200 annual transactions, you'll want to check that state's economic nexus law threshold. If you are over their threshold then you will need to register and collect. Physical presence and economic nexus are the two most common ways that require you to worry about sales tax in a state, although there are others. Best of luck!

[@jaimecoronado5853]

Ok so we started a business this year, I'm still a little confused regarding marketplaces like Etsy collecting /remitting taxes . So they collect taxes from the state the customer made the purchase from ( Texas let's say) because we have nexus, correct? they then remit them to that state (Texas) . So my confusion is where does my own state tax come from? If I sale an item on Etsy for $100 Etsy charges taxes and remits to Texas , so they charge $106.25 and remit the 6.25% ($6.25 ) to the state. Now Since we live in Utah I'd have to remit taxes to my state, where do I get those taxes? From the $100? So I'll have to pay 7.25% from that to my State? Thank you in advance.

[@LedgerGurus]

It all depends on where the customers are. Etsy is collecting the $6.25 from your customer that lives in Texas and remitting that to Texas. Etsy is also collecting $7.15 from your Utah customer that live in Utah county and remit that to Utah.

[@oguzsargin8163]

Hi, As i know Delaware has no sale tax. Does a LLC E-commerce company in Delaware owned by a non-resident person without a physical location have to pay sales tax when selling products to US customers from another states like Wyoming etc. ? Also The products will be shipped from China Warehouse.Thank you in advance!

[@LedgerGurus]

When you are starting you won’t have to collect taxes anywhere, but as you grow and hit economic nexus you will need to register and collect.

[@naamaalexandre]

Hello, thank you for your video. I have a few questions. I plan on selling on Amazon but I will not be doing FBA. I live in New York, and I will register my business and get my tax certificate in New York, should I only collect taxes from customers in New York? Won’t amazon be collecting the taxes for me, and if they do, will they collect taxes in most states even if I don’t have physical nexus and a tax certificate in those states?

[@LedgerGurus]

Yes Amazon will be collecting because as a marketplace facilitator they have nexus in all the states. You still need to file a return in NY but you won’t owe anything. Please watch my video on how to file a $0 return for amazon sellers.

[@ahrboment7060]

Hi, If I live in the EU and don't have any inventory or employees in the US do I have to collect US sales tax? How does it work for EU residents? Could you make a video for EU sellers that sell into the US?

[@LedgerGurus]

You most likely only need to worry about sales tax in states where you have a lot of economic activity. Once you reach $100K in annual sales or 200 annual transactions in a state, then you'll want to check that state's economic nexus laws. If you are over their threshold, then you are liable for sales tax. You'll want to register for a sales tax permit in that state, collect sales tax from customers in that state, and file/remit that sales tax to the state. Good luck!

[@tracyjanik2791]

I am an existing ecommerce seller (an LLC), registered with my home state, and currently sell only with Marketplace Facilitators (eBay, Amazon, Bonanza, Walmart, Etsy, etc). I file in my state and indicate the overall sales numbers and indicate that all the sales are through Marketplace Facilitators. If I open a Shopfiy or Bigcommerce site and start selling to customers directly, would the threshold information and overall sales for those thresholds consider my Marketplace Facilitator sales as well?

[@LedgerGurus]

Yes. You need to add all your sales from all your channels to determine nexus and registration/filing requirements when you sell on any channel other than marketplaces only.

[@Dollyspeaks211]

I’m based in GA with an LLC. I sell on eBay/poshmark. Those companies are collecting sales tax on behalf of the buyers state. Do I only collect Sales tax for GA buyers?

[@LedgerGurus]

Yes but since they are collecting and remitting for you, you don’t owe the state anything. You might still need to report the sale and take the whole amount as a deduction though.

[@roscoc4480]

Excellent video, thank you. I have incorporated an LLC in the state of Delaware due to no sales tax. I am a non-US resident and I am applying for an EIN without an SSN. I have a virtual office only and I intend to sell products on Amazon as using FBA. As I have no direct control over when a product might sell or where the buyer might be located will I still need to collect and pay sales tax? Thank you for your time.

[@LedgerGurus]

We can give you more individualized help through a consulting call. You can schedule one here: ledgergurus.com/ecommerce-accounting-services/sales-tax/

[@zukarabyzulesparklezbeauty]

new sub: very informative. Why do wholesalers ask for a sales tax id before talking to us. I am int in starting an ecommerce and just heard shopify does not collect taxes like other marketplace facilitators. Is this still true or has Shopify changed?

[@LedgerGurus]

Good question. Shopify is not a marketplace facilitator, so they are not required to collect and remit sales tax for you. You have to go in a set that up yourself in the settings. But don't just go in and set it up for every state yet. You want to wait until you have nexus in a state before you register because otherwise it gets very messy. a list of those thresholds, download our "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business." ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/ In regard to your first question, wholesalers are not required to pay sales tax for wholesale transactions, so they need to make sure you are a business planning to resell their product so the sales tax responsibility falls on you.

[@zukarabyzulesparklezbeauty]

@@LedgerGurus yes but they are requiring beforehand even just to inquire. So I ended up getting one just to obtain basic info. If I don’t decide to start. I’ll have to close my sales tax acct.

[@patrice11968]

Hello, so I started an online business with Shopify last year, I've made a few sales but nothing even close to the Nexus amount. I live in Washington DC and I hired a third party to start up my sole proprietorship. Since I asked for my tax ID (been a few months and still haven't received it) the state is now asking for me to file and pay quarterly. I don't know what to do. I have an accountant but she is not responding. What should I be doing?

[@LedgerGurus]

Since you are physically in DC you should be collecting sales tax from customers with the ship to address in DC. I would download the orders report from Shopify and filter the ship to province to only include DC and see how much sale you need to report to the state. If you haven't made any sales to DC customers, you can report $0 on your quarterly returns.

[@catherinefritsch3397]

Can you give an example of a marketplace nexus? I am trying to figure out if I use PayPal as a payment processor, of that means that I have a marketplace nexus in California. But the wording I was reading is very unclear and an example would be useful. Thanks!!

[@LedgerGurus]

Hi! Marketplace nexus applies to marketplace facilitators and sellers. PayPal is a payment processor, not a marketplace facilitator. For example, if you sell on Amazon (marketplace) you have nexus in CA and all the states that have sales tax except MO because Amazon has nexus in all those states. So Amazon's nexus extends to you as a seller.

[@JessicaSmith-rv3bf]

Hi, There is a business located in Delaware that outsources some of their consulting clients to an LLC located in New Mexico. The NM company does online consulting for Amazon ecommerce businesses so the clients are located in many different states. Since the NM company is being paid directly through the DE company, does that mean we only remit taxes to Delaware and NM? Since its destination, are we even responsible for any taxes to NM?

[@LedgerGurus]

I don’t think you owe any taxes in NM or DE. DE doesn’t have sales tax and the consulting service in NM doesn’t create nexus for you. I would look at your economic activity to see if you have triggered economic nexus in any states.

[@mo.downhill6760]

You have mentioned the Tax is applied to everything physical in FBA or anywhere else, what about digital products like books, are they taxable?

[@LedgerGurus]

Depends on the state, but Amazon is taking care of the tax part.

[@gabrielabohorquez6505]

Hello, I just open a LLC in WY. I do not live in US, I don’t have stores or employees. Also I receive a couple of days ago my EIN number. I want to create a e-commerce store (print and demand system). As I understand if I do not have any store or employees I do not need to pay taxes. My concern is, if I sell physical products to US clients with the print and demand system (printful) do I need to collect the sales tax? And if yes, do I need to add the sales tax for all the states or only for WY?

[@LedgerGurus]

No you don’t. And you actually don’t even need to collect in WY even if your business is registered there :)

[@michellehan2824]

Love your video. Does sales tax need to be collected for international orders? For example, selling US products to overseas customers. Thanks!

[@LedgerGurus]

Probably, but we don't do any international sales tax. You'll have to get the specific information for that elsewhere.

[@sanal3492]

Thank you so much. Very informative video. 1- If the company that manufactures my product (which I'll be selling online) resides in a different state, does that mean I have nexus in that state? 2- Also, if the threshold is reached in one year, then I have to register with the state and start adding sales tax even if my revenues in the next year maybe less than the threshold I met on the previous year? For example, I made $150,000 in Arizona in 2020 in online sales, then I need to register and start charging Arizona's customers the sales tax in 2021 even if the total of my revenues from Arizona in 2021 is say $20,000. Is that correct? So, I have to charge sales tax after the threshold of a specific state is met in one specific year regardless if that threshold is kept in the subsequent years.

[@LedgerGurus]

Hi Sarah, Here are the answers: 1. Location of manufacturer usually does not create nexus. 2. Yes, this is accurate. You can reevaluate at the end of next year and de-register the year following.

[@NutriNoche]

Both Amazon and Ebay are now collecting sales tax. What states are they forced to collect sales tax in at this time?

[@LedgerGurus]

Hi, we cover that in our recent video here: kzbin.info/www/bejne/iJXaiYB5ratnY9U

[@tbright2856]

We sell what we make as a hobby on Shopify - we have not hit 200 transactions or 100K in any particular state - do we still collect tax? Our physical location is Georgia. We are not even hitting the threshold for sales in our nexus.

[@LedgerGurus]

Yes, you do need to register and start collecting in GA since you're based there. Just watch the others to see when you get close to crossing the thresholds. You may also want to strategize on if it makes sense to collect and remit. You may find that if your sales are too low, it might be easier & cheaper to deal with the fees and fines than to go through the remittance process all the time.

[@27bates]

I live in Missouri and sell products to customers in person, I collect sales tax for MO. I am getting ready to start selling online as well, I don’t expect to exceed any nexus thresholds for other states anytime soon. My question is, if I don’t have to collect sales tax from customers in other states, do I just not charge any tax at all? Thank you!

[@LedgerGurus]

Yes that’s correct, don’t tax any sales to out of state customers :)

[@0909Yellow]

Hello, Do I have to collect taxes on loose leaf tea sold in my new Shopify store from the state of PA.(no sales made yet?? Dry tea has no tax, but I don’t know if that changes when shipping to other states. Thank you

[@LedgerGurus]

It depends on the state. For now if you are not making much sales yet then you shouldn’t pass economic nexus threshold to have the requirement to collect in other states.

[@jacinta2707]

Hi I'm interested to know at what $ amount I have to start paying sales tax? I have a new Shopify store selling in the US. Do I have to pay sales tax from day one? I live in Australia.

[@LedgerGurus]

No, for most states, you start to pay when you pass economic thresholds. Our "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business" download is a good resource for this. There is a chart in the appendix with the economic thresholds for all the states. - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@fullhouse7727]

Hello I have an auction house in Iowa. But sell online as well. Im registered in Iowa only. My accountant does not know how to structure it. Do i collect sales tax from everyone out of state and just pay it to Iowa? or do I only collect from Iowa Residents? Or Do I have to register in all 50 states? This seems way to complicated. 😔

[@LedgerGurus]

Hi! We are here to help! You don't need to collect in other states until you pass their economic nexus threshold. If you have more detailed questions, feel free to schedule a consulting call with us here so we can help you! calendly.com/ledgergurus-sales-tax

[@autumnellingson5130]

My husband has an etsy shop, but just recently started selling on shopify. We are in Colorado and he makes everything out of our homes garage. He does not have a physical location besides our home and he does not work with any manufacturers. Does he still need to register for sales tax license? Thank you for your time!

[@LedgerGurus]

I would only register in CO for now! And watch my most recent video it addresses your question: kzbin.info/www/bejne/eYeTkqqLYraca7s

[@liljay06]

Hey I have an online e-commerce store... I'm based here in Texas.. My question is, do I charge taxes for customers living in other states besides Texas?

[@LedgerGurus]

You won't be liable for sales tax in other states, unless you have nexus in those states. The most common ways you would have nexus is if your inventory is held in other states, you have employees in other states, or you have economic nexus in other states. Economic nexus occurs if you have a large volume of transactions and/or revenue in another state. Each state has differing thresholds, but if you are approaching 200 transactions or $100,000 in sales in any state, you should check their economic nexus laws. Once you have nexus, you are liable to register, collect, and remit sales tax in a state. If you don't, a State can come after you for the sales tax owed and associated penalties.

[@liljay06]

@@LedgerGurus Thank you so much. So therefore i shall only be collecting taxes in my own state where my company is registered at! Gotcha...

[@LedgerGurus]

Yes, just make sure you are registered for a sales tax permit if you are collecting.

[@brandyblansett7249]

We live in Colorado and an online store thru marketplace and have clients pay sales tax so when I file I'm confused if already collected why do I have to report and what am I reporting? is it collected twice ? Cannot get ahold of Colorado dept of revenue to ask any questions! very disturbing. thanks

[@LedgerGurus]

Hi! CO DOR still ask you to report your sales and exempt sales amount but they do not expect you to remit any taxes.

[@annieespejo5732]

I have a small apparel brand business in FL through shopify. I have only made $3K with less than 200 sales this past year. I am registered, do i have to charge and or pay sales tax at this point?

[@LedgerGurus]

I would make sure to charge tax and remit tax from your FL customers. And register with FL of course.

[@danielgil9747]

What about selling courses online on a website? It's an intangible asset because there is no physical course; the students would do it on the same website. Do those types of companies have to pay sales taxes? What about who sells courses is not an entity (LLC) but a sole proprietor? Thanks

[@LedgerGurus]

Depends on the state. Generally, online courses that are pre-recorded are usually taxed, but if there’s any live interaction with the instructor, it becomes a service and is not taxable.

[@krystelmallette2137]

If I understand correctly I don't collect the taxes unless I have a considerable amount of $ in a state. For now, I pay for it myself. Is it the same in Canada?

[@LedgerGurus]

You don't have to remit taxes in a state you don't have nexus in, so that means you shouldn't have to be paying it yourself. If you're that small, and you only have physical presence in the state your business is registered in, you probably don't have nexus anywhere else. That means the only state you need to worry about collecting and remitting in is your home state. And you should be collecting that, not paying it out of your own pocket. That's probably a good bit of your profit margin going down the drain. For more details, I suggest you watch our free masterclass "The Uncomplicated Truth about Sales Tax." You can access it here: ledgergurus.com/resources/sales-tax-masterclass/ We only work with US-based sales tax, so we can't help you with Canadian taxes.

[@kaiwensong3684]

Thank you for the very informative video! I have one question: say I have physical nexuses in both Michigan and Maryland and no other economic nexuses, do I only have to collect sales tax towards Michigan and Maryland customers, using the sales tax rates in those respective states?

[@LedgerGurus]

That is correct. Remember to register for a sales tax permit in Michigan and Maryland before collecting sales tax from customers in those states.

[@dblvzn751]

Thank you for this info. If i am operating as a sole proprietor and selling tshirts out of my home through an online webstore and have no other partners anywhere and low sales because i am just starting, do i just register with my home state where i am working from? any info would be appreciated.

[@LedgerGurus]

Yes that’s correct!

[@FashionProjects]

Hello! Thank you for your videos. Extremely helpful. I have another question: My “side hustle” business is registered in TN where I have ALL the inventory and where I ship it from. But, I am a resident of FL by choice. I spend time in both places and I have another job in FL. Although I go there often and a lots of my sells are to that state, I don’t keep any inventory there and I ship everything from TN. I don’t sell anything in person in FL, I just guide them to shop on my website. Do I HAVE to consider FL a nexus?

[@LedgerGurus]

I would say yes because you are physically located in FL, especially if you file income tax in FL, they would already have your information and know about your side hustle.

[@karenrivera6325]

Hello! I am starting a small business on shopify in Texas soon, am I able to start selling while I wait to receive my permit?

[@LedgerGurus]

Yes you can as long as you’ve started the registration process with Texas.

[@MKQO1]

what happened If I moved and I ceased a location? I haven't sell for two years. I would like to sell again but I haven't file taxes for the last year? t's overdue and it doesn't allow me because it says I have no registered location. What should I do in this case? Do we still have to registered a location even when we sell online?

[@LedgerGurus]

I'm not sure I completely understand your question. Did you have an ecommerce business before you moved or a brick and mortar business? You certainly do have register in your state when you sell online. Registering in the other states needs to happen after you pass the economic thresholds or have physical nexus there. For more information, you can download our free PDF "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business." You can access it here: ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@jencielandry6031]

Hey! What should i do if i have an ecommerce business and use TaxJar, but have made the mistake of collecting taxes in states without nexus and have remitted taxes in those states? How can i pay that sales tax back without having a tax id in those states. Also, if i have missed the deadline to file?

[@LedgerGurus]

Sorry, I’m not sure I understand your question. How were you able to remit taxes without registering in those states and having a state ID? Generally, when you collect sales tax where you don’t have nexus, you either refund tax back to the customers or you need to register with the states first and file back filings for the past periods. TaxJar doesn’t support back filings currently. You will need to use a different solution or do it manually.

[@rfabian10]

What if your self employed, sole proprietor would i still need a tax id or can i just use my SSN

[@LedgerGurus]

You can use your SSN when applying for a sales tax license if you are self-employed or a sole proprietor. Sorry for the late reply! Please let us know if you have more questions.

[@alexandriaguzman6128]

What about use tax? Everybody is talking about sales tax but not use tax. I've read but not sure if it is true that you have to charge use tax if you haven't established a nexus in that state. This is so confusing and frustrating to have your own website and now know how to set this up.

[@LedgerGurus]

No you don’t need to. Use tax is incurred when you purchase something for use that you didn’t pay sales tax for. But for remote sellers, lot of time states require them to register for vendors use tax and require in state sellers to register for sales tax.

[@sauce89124]

Would you pay sales tax to your state for an online order if both your inventory and your customer are out of the state you nexus in? Or would you pay your state tax if the customer is located in your state ?

[@LedgerGurus]

Hi Joseph, you only collect and remit sales tax for customers who reside in the states where you have nexus. So step 1 is to figure out in what states you have nexus. Step 2 is to register, collect, and remit for only sales from customers that reside in the states you have nexus.

[@onshop7919]

Hi LedgerGurus, first of all thank you so much for the video it give me at least a little bit of how I deal with my tax, but there are some question that I really hope that you can answer it, pretty please. My prolog is I'm non US resident and a drop shipper of beauty tools, my supplier is in China but they have warehouse in US, my main costumer is in US, I do already have EIN for my LLC and ITIN for me as the owner/manager (for making Bank Account and payment gate away) and here some the question: 1. Due to in the process of making EIN and ITIN take way longer than usual (because I just get in January 2020 for EIN and in August 2020 for ITIN) I cant make any sales or income, Do I still need to pay any taxes for both my LLC or as Individual, if I still don't have any sales in recent year? 2. I just want to confirm, I saw in some the comment, that although you are a non US resident, but have LLC (in my case in Delaware), so I do have Nexus Taxes? which I obligate to register, collect, and remit sales tax in Delaware? is that right? but do I still collecting the tax in Delaware, if even in Delaware I still under the economic threshold? 3. In regards with Tax app like (Avalara, TaxJar, Taxify) do I need to use it before I start selling my goods or after meet the economic threshold I start to use them? or just because nexus taxes in Delaware, I need to use it before I start selling my goods because I need to collect and remit sales tax in Delaware? I terribly sorry if my question is a bit too long, I also hope that my question can help other people to, because for a non us resident is kind of complicated I am looking forward to hearing from you and thank you in advance.

[@LedgerGurus]

1. If you have not had any sales, you won't have any sales tax obligations. We are not experts with income and business taxes, so we would defer to having you check with experts in that area. 2. This is correct. You have "physical nexus" due to your LLC being based in Delaware, so you will need to register, collect, and remit for customers in Delaware. 3. Here's a video on sales tax apps: kzbin.info/www/bejne/Z32apGmiobyfiNE. It is up to you when you would like to start using these apps. As your business grows and you start to have nexus in multiple states, it usually makes sense to use one of these apps. Otherwise, you'll just need to register, collect (by setting up sales tax settings on your channel(s)), and file and remit manually.

[@onshop7919]

Hi @@LedgerGurus thank you so much for answering my long question, how your answer can help others too.

[@determinance]

@@onshop7919 Hello, im also a non us citizen, how long did it take for you to get your EIN? and Do I also need to apply for an ITIN? for I am hoping to open my stripe account

[@rahulparikh8220]

I m selling through my website and App. The purchaser may be in out side state also. How do i decide where to collect sales tax? The purchaser's state or from my home state where i run my business?

[@LedgerGurus]

Hi Rahul. You will only need to start by collecting and remitting sales tax from any customers in your home state. Make sure you get a sales tax permit from your state before collecting. As your business grows, you may become liable to register, collect, and remit in other states. For example, if you have employees or your inventory is held in other states, you'd be liable for sales tax for customers in those states. Or if the number of transactions or total sales in another state hits certain thresholds. You can download our sales tax guide for more details: ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@AceInnovativeDesign]

First of all, very informative videos on the sales tax topic - best ones I can find on KZbin so far, well done and thanks! Now my questions: we are a small Canadian business that sells to the States through two channels: Amazon FBA, and Amazon MCF (Multi-chanel fulfillment) via our own website. Sales volumes are way below the $100,000 / 200 threshold for every state (so no economic nexus?). BUT since we are using FBA and MCF we do use Amazon’s warehouses, which means we still need to register and collect sales tax that we made on our website (MCF) in those states? Even though we just have, say, $5,000/year revenue in that state? Thank you and keep on the great work!

[@LedgerGurus]

Great question. FBA can get a bit tricky. I suggest you download our PDF "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business" - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/. It will give you some great info on this topic. In the 1st section - Determine Sales Tax Nexus - it says, "All states, except, IL, NY, and AZ consider your stock held in an Amazon warehouse enough of a presence to create nexus in their state." So yes, because nexus has been created through FBA, you do have to register and collect on your website.

[@depecheddurand]

I`m a new retailer can someone answer this.When people try to purchase taxable items on fodd stamps like soda and nutrition items , should we charge tax on them or no ? if we don`t them we are not paying sales taxes on these items and that can trigger an audit ?

[@LedgerGurus]

According to this, no - ask.usda.gov/s/article/Can-sales-tax-be-charged-on-items-I-bought-with-Supplemental-Nutrition-Assistance-Program-benefits#:~:text=Oct%206%2C%202022&text=No%2C%20retailers%20cannot%20charge%20sales,Assistance%20Program%20(SNAP)%20benefits.

[@CS2_CS-GO]

What if you're located in europe and sell in US with printful how does that work?

[@LedgerGurus]

A good place to start to learn about sales tax is our downloadable PDF "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business." - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@bobbg9041]

0 becuse now I wont make online sales its not worth it.

[@loubernadettealvarez2739]

If ever Shopify seller collected sales tax for a buyer online but does not remit that… economic nexus was not yet reached.how will that be presented in the sales tax return? since it is an online payment, should the payment be returned to the buyer? what will be the treatment?

[@LedgerGurus]

If sales tax was collected, you need to register voluntarily (even without hitting the economic nexus) or refund the taxes to the customers.

[@barnydecay6639]

Hi...I am an eu seller who makes orders to an aliexpress drop shipper with a warehouse in us. The drop shipper sends straight to my us customer. do I have a physical nexus with the state where the dropshipper keeps the warehouse?

[@LedgerGurus]

No. You don't own the inventory, so its location doesn't create nexus.

[@kfranzner]

Hi there, thank you for this video! My dropshipping eCommerce is based in DE. I sell only on my website, not Amazon or Shopify. My suppliers are charging sales tax from me but I'm not sure if I should charge it back to my customers. Can you please help me understand the sales tax scenario for a drop shipping eCommerce that sells exclusively from its website? Thanks for your time!

[@LedgerGurus]

Hi! Yes definitely! You can provide resale certificates to your suppliers so they stop charging you tax. You can voluntarily register in those states and start collecting tax or I would increase your price to your customers to cover that cost if you are not able to give them the resale certificates or register in those states.

[@kfranzner]

@@LedgerGurus thank you for your attention! So if I'm not registered to the customer's delivery state, I can not repass to my customer the sales tax the shipper charged me, correct?

[@tonys490]

hi we are a now Uk based online store .. we aren't vat registered as we are under VAT threshold in Uk .. do we have to charge any vat in Uk , EU or rest of world when we get orders? is sales tax and vat same ??? thanks a lot

[@LedgerGurus]

I believe you need to register and charge VAT in the UK and you will need to register and charge VAT in the EU after you pass the 10,000 EUR threshold.

[@ElizabethAmanna]

When you look for a Sales Tax "Permit" or "Tax ID" for Florida, there is literally 20 options for Sale & Use Tax. I cannot find a single place where it says "Permit" or "Tax ID" so I registered, filed everything out perfectly, and got a certificate saying, "Certificate of Registration" with a Certificate number and "Florida Annual Resale Certificate for Sales Tax" attached. There is no "Tax ID", just my certification number. I am so confused, all I'm missing is a Tax ID number for Shopify...

[@LedgerGurus]

You should use your “Business Partner Number” for FL.

[@ElizabethAmanna]

@@LedgerGurus It says on my official document not to use the Partner number for resale

[@LedgerGurus]

@@ElizabethAmanna I would use business partner number as your FL sales tax ID, but use “certificate number” to provide resale certificate to your suppliers.

[@meganantunes3559]

Do you have to register with every single area you want to sell to with an eCommerce site? If so that is crazy! how do you get it all done?

[@LedgerGurus]

Initially you register in the state your business is set up in. After that, you only register in states AFTER you have nexus there - physical or economic. We just did a webinar this week that explains the whole process. I think it'll answer any questions you have right now. Click here to watch it on-demand - ledgergurus.com/resources/sales-tax-course-updates/

[@hermanlacc7730]

I don’t have nexus with other states. All inventory will come from California.

[@LedgerGurus]

Since you don't have nexus with other states, you don't have any sales tax collection or filing obligation with other states. I would keep monitoring your sales revenue and volume into other states to make sure they fall under the economic nexus threshold.

[@ibrahimnasser3341]

Thank you so much for this amazing video. I started an online business 5 months ago. I do everything from home in Michigan. I’m getting closer to reaching 200 sales. My question is do I charge taxes only to the people who order from Michigan where I am based? Or do I have to register in all states?

[@LedgerGurus]

At the beginning you only register & charge sales tax in the states you have a physical presence in. That sounds like it's Michigan right now. You need to watch your sales in other states to see when you're getting close to economic nexus. We just did a webinar on all this that will answer so many of your questions. Click here to watch it don-demand - ledgergurus.com/resources/sales-tax-course-updates/.

[@extendedclips]

🤲🏽

[@jacknroyappareltees3732]

Hello, great information shared! We plan to operate from EU with a a company settled here and sell in the US. If we consider we are going to be a B2C we do not have to charge VAT, but we have to collect sales tax from each state's citizen differently or collect sales tax with the nexus with our print provider?

[@LedgerGurus]

The location of your print provider should not create nexus. Since your business is registered and based outside the US, you likely won't have nexus in any states until you start to hit economic sales tax thresholds. If you are approaching $100K of annual sales in a state and/or 200 transactions, then you should look into their economic nexus laws. Also, if you have any employees or inventory held in the US, you would have nexus in the states where you have employees or inventory held. And therefore would need to register, collect, and remit sales tax for sales in those states.

[@Tai321456]

Im going to be selling to the entire US. Do i have to register for all 50 states before i start collecting sales tax?

[@LedgerGurus]

You only need to register in the states where you have nexus (physical and economic). Do you have physical and/or economic nexus in all 50 states?

[@Smashbash33]

What a great video for such a complex topic! My only question is: once you reach an economic nexus in another state (by $ or #of orders) you only have to start collecting/remitting tax for all orders after? As in nothing retroactively. You then wouldn’t have to pay any back tax on the orders before the specific threshold? Thanks so much in advance.

[@LedgerGurus]

You are correct. You only pay taxes on the amount after you reach the threshold. If you'd like more information on sales tax, check out our free masterclass "The Uncomplicated Truth about Sales Tax for eCommerce Businesses." It's packed with valuable information AND gives you a roadmap to follow to do it correctly. It also tells you the 3 things NOT to do when you're setting up your sales tax. ledgergurus.com/resources/sales-tax-masterclass/

[@dakotayork4677]

What is the threshold I am confused 🤔🤔

[@Amjadastrology]

how about when you sell memberships to international people.

[@LedgerGurus]

You probably don’t have nexus in international countries and regions yet right? If so you don’t need to charge taxes.

[@miaRA390]

HI, I am dropshipping from china, my LLC is in florida. Do I need to collect taxes only from people who reside in FL?

[@LedgerGurus]

I would register and collect taxes for customers in FL for sure because that’s your home state. Even though you use a drop shipper, I would still track your sales by state to monitor if you have economic nexus in other states.

[@Arsalan-Ahmad]

Hi. Thanks for the information video. I am about to launch an online course/ebook. This course could be bought by anyone in the world. You suggested to not collect sales tax until I register with the state for it. However, if I sell the course and not collecting sales tax in the beginning then does it mean that I have to pay the sales tax from my pocket? Also what would happen if someone buys my online course in EU, Canada, Australia and India etc.?

[@LedgerGurus]

For customers in the US, online courses are not taxable in all the states. And even if they are taxable in all the states (hypothetically), if you don't pass the economic nexus threshold in all 45 states and DC (there are 5 states that don't have sales tax), then you don't need to worry about registering and remitting sales tax. If you know right now before the launch that you will have nexus (physical and/or economic) in certain states, we'd recommend you register with them now using the date you are launching your course as the effective date. Then you can start collecting once you get the application approved. If you don't register and collect, then you would be liability to pay sales tax out of pocket if you have nexus in a state. Here's a good article on the risks of collecting sales tax without registering for a permit: www.avalara.com/us/en/blog/2016/07/can-i-collect-sales-tax-without-registering-to-do-so.html#:~:text=Without%20a%20permit%2C%20you%20may,in%20a%20different%20category%2C%20however. ​ We don't advise on sales tax outside of the US, but you may have the potential liability for VAT in other parts of the world.

[@Arsalan-Ahmad]

@@LedgerGurus Thanks for the reply. Much appreciated. I see so I think in that case I should register with the state where I am registering my LLC (as I have physical presence). I have seen that some states has an annual limit of $100K or 200 separate transactions. To me reaching $100K might not be the case. But reaching 200 seems like a possibility.

[@baeyani9996]

I am a new e-commerce in North Carolina on Shopify. I have a physical address registered with my llc. Rarely am I there and I don’t have inventory packed there. With it being registered that categorized me as a physical nexus? Which means I should register for a state tax id and charge my customers? I just want to be clear. Somebody please point me in the right direction 😥💕

[@LedgerGurus]

Yep. You're completely right on this. Because you're registered in NC, you do have register for a sales tax ID and charge your customers. If you're fairly new and don't have inventory in any other state yet, you probably don't have to worry about hitting nexus anywhere else yet. Congratulations on your new business!

[@baeyani9996]

@@LedgerGurus thanks so much for the confirmation! Your channel is awesome !

[@LedgerGurus]

@@baeyani9996 Thank you and you're very welcome!

[@LATOHOUSTON]

Remit those sales taxes to those states??? As in whichever states your revenue comes from you need to pay them sales tax individually? As in if your an ecommerce dropshipper you are supposed to know which state your buyers are coming from? Forget all that.

[@LedgerGurus]

Yes, it's super annoying, but states are coming after sellers who aren't compliant. To avoid penalties and paying all past sales tax out of pocket, you'll want to be compliant. But you should be able to determine which states you have nexus in (physical or economic) and then register for a sales tax permit in that state and setup your sales channels to collect in those states. If you are a small seller, you likely only need to start in the state where you and your business resides.

[@skylight188]

Hello there, i need assistance in my store. If you can help me on it

[@LedgerGurus]

Sure. What do you need?

[@WonderdogsNetDogTraining]

Thank you so much for your helpful and informative videos! I'm just starting an online, e-commerce business and do not have a warehouse or physical presence. I'm re-selling retail products. I live in CA, and will only be selling to CA residents. Do I need to have a seller's permit, and do I need to collect sales tax? If I need to collect sales tax, should I set my sales tax rate to CA's tax rate? Your advice is greatly appreciated.

[@LedgerGurus]

Yes, because your business is based in CA, you need to register and collect sales tax in CA. If you want more information, download our "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business" PDF. It's full of useful tips. ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@morgancox6280]

Is there a reliable website that lists the nexus thresholds for each state?

[@LedgerGurus]

We've got a free download that's been recently updated. You can access it here - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/. The list is at the end in the appendix, but don't just skip to the end. The PDF has some really valuable info in it about sales tax and how to get compliant.

[@Joolie]

so you need to apply for all states individually on the state's website????

[@LedgerGurus]

Yes, but only after you hit nexus in each state. Download our "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business" for more details. ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/

[@salestaxusa]

Hi, If I am selling through Amazon, what is my registration and filing liability in these two cases: 1. Home State: PA, Inventory in Amazon centers CA, CT, IL. No economic nexus thresholds met 2. Home State: PA, Inventory in Amazon centers CA, CT, IL. Economic nexus thresholds met in GA, MA, NC, TN Please help

[@LedgerGurus]

Because you're only selling through Amazon, the marketplace facilitator laws are in effect and you are pretty much off the hook. The only state you need to worry about collecting and remitting in (Missouri) is not one you have nexus in yet. Watch it, though. If you end up with inventory there, you'll need to deal with sales tax there. Their economic nexus law doesn't go into effect until 1/1/2023. If you'd like more detail, you can watch our on-demand webinar "The Uncomplicated Truth about Sales Tax for eCommerce Businesses." - ledgergurus.com/resources/sales-tax-course-updates/

[@LillyEve1]

I am thinking of starting an online shop using Shopify and would be using a drop-shipper to fulfill orders and they ship the products for me, they are based in California and I am based in Georgia. Do I need to register for a sales tax permit with my home state right away even though I have zero sales and just launched my website (I am still in the research phase, so no website yet)? Also, do I have nexus with CA with the drop-shipper? They create and package up the products and ship them out to the customers and I never see the product. I don't know if that qualifies as a "warehouse"? Lastly, how does shipping taxes work? Is that on a threshold base as well? Or are shipping taxes lumped in with sales tax when you make either 200 annual sales / $100k+ within a single state?

[@LedgerGurus]

We suggest registering with GA because that’s your home state and you have physical presence there. You don’t have nexus in CA because of the drop shipper. The economic threshold base looks at sales amount and you don’t need to include shipping.

[@LillyEve1]

@@LedgerGurus If I charge shipping then will that need to be taxed?

[@LedgerGurus]

@@LillyEve1 Shipping needs to be taxed in some states, not all the states. Here is a good guide from Avalara: www.avalara.com/us/en/blog/2018/11/how-to-handle-sales-tax-on-shipping-a-state-by-state-guide.html#:~:text=If%20one%20delivery%20charge%20includes,a%20taxable%20sale%20are%20exempt.

[@a7xfanben]

Thanks for the info!

[@LedgerGurus]

You're welcome!

[@gabrielsalazar509]

how about selling digital goods?

[@LedgerGurus]

That will depend on the states you're selling in. Different states have different rules. Research your own state to see what is required, and remember that even if you don't have economic nexus in other states yet, you DO have physical nexus in your own state. You can even call your state's Dept of Revenue and ask them. Research carefully the rules in the various states you're selling in as you approach economic nexus in them.

[@anagutierrez3156]

Do we collect local and city tax aswell online?

[@LedgerGurus]

Yes! All levels - state, county, city, special district.

[@johnsm4726]

Hello, I am just starting out making an online shop in my square space website (Business Plan). The sales tax part, - Is there a way other than having to manually enter in sales tax rates for every zip code in North Carolina, US? - If I upgrade to a square-space - Commerce Plan, will it automate the process and calculate sales tax in real time? - Is TaxJar the only other extension that can do this? Do I still need a TaxJar if I get a Commerce Plan? Is anyone else in the same boat or past this phase? Any other suggestions? Thank you!

[@LedgerGurus]

It would probably be best if you scheduled a consultation with one of our sales tax experts. They'll be able to answer all of these questions. Here's the link - calendly.com/ledgergurus-sales-tax

[@hiranikarim]

Question: a georgia based online business has nexus only in GA. The website seems to be only collecting taxes from customers ordering from GA, as it’s supposed to. But once Instagram Shop was enabled, transactions from Instagram shop Is collecting sales tax even from customers outside of GA. Now as a GA based LLC the sales tax permit is only for GA. What is the seller supposed to do with the sales tax that Instagram Shop collected from customers residing in multiple different states?

[@LedgerGurus]

Oh man, that sounds like a pain! You can register for sales tax and remit in all the states where you collected. Then de-register after remitting. Or you can simply refund the sales tax collected back to customers. We would make sure those settings are correct moving forward!

[@marlicrabtree9074]

Hello! I have a question. I am starting a business and will be located in Mississippi, but most of my customers will be located in Virginia. I know that until I reach the 200 sales or $100,000 threshold I don't need to worry about VA. BUT, when I do, will I have to charge both MS and VA tax on those sales? Once I reach the threshold, will I charge those specific customers ONLY VA sales tax? I will no longer have to report those sales to MS/pay taxes to MS on those purchases?

[@LedgerGurus]

No, you will only charge MS sales tax to MS customers and VA sales tax to VA customers. You only report sales tax for purchases sold to customers IN that state, so you don't need to report VA sales to MS at all.

[@katherinemartinez7095]

Hello I got something on facebook marketplace saying In my sales tab, Marketplace has a note stating that " Bank Transfers are on Hold. Facebook is required by US law to collect tax information from people making more than $599 per calendar year on Marketplace. Bank transfers from your balance are on hold until your tax info is verified." But i only sold $285 and im so confuse i already peovide my information and is in hold all my payments Is the paper 1099k or 1099M is it gonna affect me?

[@LedgerGurus]

We are not sure what is happening here. This sounds like an income tax problem, not sales tax, and we would recommend contacting FB about it. Good luck!

[@stephanhoehne7776]

Hi, I'm under 18 and have a Shopify account that I pay the monthly subscription on, and I have a few questions I hope you can answer. (Disclaimer: I'm from the US) 1. If I change the Shopify account to my parent's name, will they have to pay the Shopify account's taxes? 2. When registering for Stripe for Shopify, should I use all of my parent's information? 3. When creating a PayPal account, can I put it under my parent's name and use my high school checking account debit card? 4. Is there any way I could have money sent to my account without Shopify shutting down my store?

[@LedgerGurus]

Since you're under 18, you need to do all of this under a parent's name.

[@mahmoudfarag4136]

I have a question plz. I have exceeded the sales nexus last year so I filed sales tax return in maine state but this year I did not exceed the threshold so what should I do??

[@LedgerGurus]

Maine’s economic nexus threshold applies to current and prior calendar year. So even if you don’t pass the threshold this year, as long as you passed it last year you will need to keep filing. If there are two years in a row that you don’t pass the economic nexus threshold then you can de-register and stop filing.

[@mahmoudfarag4136]

@@LedgerGurus this means that I have to collect sales tax from customers, right? plus could you plz tell me the process of deregistration and the source if this information? Thank you so much for your help

[@LedgerGurus]

@@mahmoudfarag4136 if you have nexus in Maine, then you need to keep collecting and filing. You can file a final return or call the department of revenue to cancel the license.

[@natalie.leclerc]

If I'm a new dropshipper residing in Ontario Canada currently with 0 sales, would I need to register now to have products set up to collect sales tax since I live and operate out of this province, or would I only start doing this once I made 200+ sales? Do I need to collect PST?

[@LedgerGurus]

We cannot give advice about Canada because we only work with US states.

[@bestfrandsiddbestfrandsam1039]

So i have a question, if i am registered in Oklahoma sales taxes do i only collect taxes in Oklahoma ?

[@LedgerGurus]

Yes, you only collect and remit sales tax in states that you are registered. You don't want to be collecting sales tax in states where you have not yet registered.

[@bestfrandsiddbestfrandsam1039]

LedgerGurus thank you and one more question if i do have a lot of out of state orders and not collecting taxes on those will i owe at the end of the yr ?

[@LedgerGurus]

You won't be liable for sales tax in other states, unless you have nexus in those states. The most common ways you would have nexus is if your inventory is held other states, you have employees in other states, or you have economic nexus in other states. Economic nexus occurs if you have a large volume of transactions and/or revenue in another states. Each state has differing thresholds, but if you are approaching 200 transactions or $100,000 in sales in any state, you should check their economic nexus laws. Once you have nexus, you are liable to register, collect, and remit sales tax in a state. If you don't, a State can come after you for the sales tax owed and associated penalties.

[@jazz1750]

Thanks for the video I'm just starting a online art supplies store and wow, so much to learn about taxes...maybe it will be a grand opening and then a grand closing...😩

[@LedgerGurus]

Hope not! Let us know if there’s anything we can help with!

[@artzgigglesdesign5562]

Hi, I am from Canada and about to open a Shopify store. I want to sell to Canada & USA. What is my process when it comes to setting up the tax section. My business is registered. Do you offer services where you review the set up?

[@LedgerGurus]

I suggested downloading our "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business." Here's the link - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/. It'll have the whole process you need for this. And yes, we also offer services to review the setup. Click here to schedule - calendly.com/ledgergurus-sales-tax/1-hour-sales-tax-channel-setup

[@pinkboyhandmadejewelry3524]

Hello I am from Turkey never been in USA. As a foreign seller I setup an LLC which has New York address is it considered a nexus for me with new york? I do not have an inventory in new york

[@LedgerGurus]

Hi! If your LLC is registered with New York State then yes you are considered having physical presence in New York.

[@pinkboyhandmadejewelry3524]

@@LedgerGurus LLC is registered in Delaware, my business adress is in New York. In that case, do I have a nexus in Newyork or Delaware

[@LedgerGurus]

@@pinkboyhandmadejewelry3524 why is your mailing address in New York? Do you have an employee or owner there?

[@mehmetsaracoglu4601]

@@LedgerGurus I do not have any employee or anything. I bought an adress from a person. He lives there. if IRS send any document he will scan it and send it to me

[@LedgerGurus]

@@mehmetsaracoglu4601 okay then I think you are okay to not register in New York. And Delaware doesn’t have sales tax, so you are good there too!

[@remusremeczan709]

Hello i like your video! But I have a question, if I live in the EU and create a company here, but I sell products online in the US, where do I have to pay the tax?

[@LedgerGurus]

You will pay sales tax to the states you collect it from. After you pass a state's economic threshold, you have to register to pay sales tax there, and then you collect and remit that sales tax to that state. For more information about sales tax and for a list of economic thresholds by state, download our PDF "10 Steps to Ensure Sales Tax Doesn't Burn Down Your eCommerce Business" - ledgergurus.com/resources/downloads-2/10-steps-to-ensure-sales-tax-doesnt-burn-down-your-ecommerce-business/