How To Charge Taxes On Your Shopify Store | Easy Method

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Are you collecting Sales Tax on your Shopify Print on Demand Sales?
Or did your face just flush reading that??
Don’t panic - today I have a super easy way for you to set it up.
I broke down Sales Tax for Shopify in 3 easy steps.
1. Turn it on and start collecting it on your sales.
2. Make an account with your state.
3. Manage and pay the sales tax with a Shopify app called TaxJar.
Go check it out!
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[@amberpatterson9646]

I was so shook after watching a couple of videos and I was like OK I can’t do this but I have to watch your video you made it so simple thank you so much

[@KerryEgeler]

I love hearing that. Thank you so much

[@wevhufashion]

This is the best video that I have seen where you explain taxes and Shopify clearly. Thank you!

[@KerryEgeler]

Thank you so much

[@laflakvar]

The most clear and complete explanation that I've found. Thank you Kerry!

[@KerryEgeler]

OMG thank you so much for those kind words!

[@fastpraylemonade]

Agreed. Just subscribed for that reason

[@GiveitsomeSOUL]

I think there are two separate kinds of nexus. Physical nexus, meaning you have a physical presence within that state and Economic nexus. Economic nexus is when you are required to collect and pay after you have hit a certain threshold of sales. Not sure about the details on economic. Also you don’t need to have a LLC to register for sales tax. You can do this as a sole proprietor as well.

[@ElizabethAmanna]

Your video was extremely informative, thank you. Some updates in Florida: It is required as of July 1st 2021 to collect sales tax although you are only selling online. Also, TaxJar requires a subscription to autofile ($20 a month) plus it is $30 more per auto file.

[@KerryEgeler]

Tax jar saves you about a million dollars worth of time, worth it

[@backs8189]

i’d rather pay those fees and make sure i’m paying proper taxes , also not stressing myself out by paying them myself

[@sampalma4087]

What does this mean for Florida?

[@AdrianJ]

The video I didn’t know I needed. This was sooooo thorough, thank you so much for the step by step walk through!!

[@KerryEgeler]

Thank you for the kind words!!

[@mychaelthomas525]

Finally, some explaining this in a simpler way and not speaking as if your audience are tax experts! Appreciate the Info!

[@KerryEgeler]

Man I love that comment! Thank you

[@danaevs2232]

Thank you, thank you, thank you!!!! You made it so simple and straight forward for me. I finally understand what I need to do! Much appreciated ❤

[@ginnysilver]

3:38 It is against the law to collect sales tax "just in case" - you MUST hold a seller's permit for the state you are collecting sales tax in, files sales and use tax returns, and remit that sales tax. Do not follow this advise - completely incorrect and harmful to viewers.

[@maifranco79]

I opened and LLC first to start my small business and now I'm going to start my shopify store and I'm nervous. This is the clearest explanation I have heard on where to collect taxes. Thank you!!!

[@KerryEgeler]

You're so welcome!

[@TheAlishamarie2290]

Thank you!! I was so confused and overwhelmed about the tax portion. This helped tremendously.

[@KerryEgeler]

So glad!

[@itsinyouryard]

Absolute best video on this subject. How on Earth are the other youtubers skipping over this??!?! Thanks man.

[@KerryEgeler]

Thank you so much!

[@myka16]

I don't typically comment or like KZbin videos - But when I do, it means the video was FREAKING HELPFUL! THANK YOU!

[@KerryEgeler]

OMG thank you! You’re very welcome!

[@boujeejewels5663]

Thank you ! For making this extremely simple ! I went threw a couple of tutorials and I was about to pull my hair out tryin to understand LOL

[@KeontraTyese]

Same for me literally going crazy lol I’m so happy I found this video

[@keithbetts4656]

Best explanation that does not try to scare you into buying some sort of consultation or service! I just subscribed!

[@KerryEgeler]

Let’s goooooo!

[@jaredsemingson7565]

I've watch like 6 videos on this topic and yours made the most sense

[@KerryEgeler]

Let’s goooooo thank you!

[@yomyoppenheim1538]

im not the kinde guy that posts comments but this is somethink else. i was frustrated whan it came to taxes as a beginner i looked through a lot of videos but i got more confused until i found your video which was so clear and easy to understand. thank you so much

[@KerryEgeler]

Wow, thanks so much! Taxes can be extremely frustrating. Glad this helps!

[@briannabarberio]

This was so incredibly helpful! I really appreciate you taking the time to explain this. Thank you so much!!

[@KerryEgeler]

Glad to hear this!

[@mikalarson363]

If you use a POD like Printify, that has print providers all over the country, they actually charge you tax for all your orders. That means even though you only owe tax in one state, your customers all over the country has to pay it (or you pay it on their behalf) directly to Pintify. It sucks, but that appears to now be the way it works at least with them.

[@sandraroberts6623]

Thank you so much! I'm just starting and have a huge migraine trying to figure out the tax thing and with you saying I don't have to worry about it right now because I don't have my LLC due to not having money and don't know if it's worth it I can breathe and open my shop.

[@KerryEgeler]

Yes! It can seem like a lot up front, but you've got this!

[@DragonRex]

This explained everything I needed in 11 minutes, i thank you so much man

[@KerryEgeler]

Glad to hear that

[@shadongeche3827]

Bro your a blessing, this video saved me I was mad close to giving up after spending hours making my store🙏🏾

[@KerryEgeler]

Thank you for watching and thanks for your comment!

[@EslamovicxXx]

Hey, Kerry! Great content as usual. Greetings from Egypt! What about the economic nexus? Which means that even if you are not a resident or having some sort of physical nexus in the US, you'd be still charged tax. For example, if you're using Printful as your dropshipper, they HAVE TO collect taxes as they have nexus in the US. Eventually, they might collect it and deduct it among their costs I guess. This is what I got of various vids about this topic. Hopefully you correct me if I'm wrong. Stay safe, awesome and productive!

[@tommydaq2]

Perfect timing, Kerry!!! Just got my state's Sales & Use Tax license!!! Thanks for this!

[@KerryEgeler]

Let’s gooooo !

[@tommydaq2]

@@KerryEgeler Opening a Brick & Mortar for Luv Pup so very anxious for that POD to Screen Printing training!

[@CheckOasis]

Thanks Im actually From Oklahoma!!

[@KerryEgeler]

Cool!

[@hyberrt]

First video I found that actually explained it clearly

[@KerryEgeler]

🕺🏻🔥

[@PeacefulRelaxation24]

Exactly i dont have ny business permit i was worried about taxed thank you for explaining exactly same idea start first when we earn and love to continue thats the moment to start the permit process

[@thehealthylife5715]

Another legendary video! And this is the first time I've been on your channel!

[@KerryEgeler]

Dang!! Love it!!

[@jadenbelcher1729]

Best informative video yet, I was extremely confused and you just made it so simple.

[@KerryEgeler]

Awesome

[@lisastitt7653]

We’re here in Oklahoma! THANK YOU for this!!!

[@KerryEgeler]

You’re very welcome!!

[@justjordan2478]

Thanks a lot man, I'm trying my luck in the tshirt business and was a little perplexed on how to make sure my taxes are being collected.

[@KerryEgeler]

Glad I could help

[@briauna1406]

This was super helpful!! This whole time Im thinking sales tax and state taxes are the same thing. Would you be able to make a video on how to file your sales tax in your state and how.

[@KerryEgeler]

I have only ever filed in Oklahoma

[@dmontaeturner6045]

just started my company and you have been great I absolutely love your videos and will always come back to your page for advice or how to’s thank you!

[@KerryEgeler]

Thank you so much!

[@aleesap8944]

Very informative and straight to the point! Thanks so much Kerry!

[@KerryEgeler]

You’re very welcome!

[@ria2212]

Thank you so much for this! You were clear and straight to the point.

[@KerryEgeler]

Thanks for watching!

[@mmandkat]

This was soooo helpful! Other videos are so vague but you really made it easy to follow. Sharing this with my friends!

[@KerryEgeler]

Thank you!

[@alexg8842]

I been doing a lot of research in this topic but from my understanding is if you reside in one state and you sell your product in another state your considered to have an entity in that state there for you have to pay sales tax for that state as well so this is where I’m confused in , you provide great transparency in your video , but I’m still confused on this aspect please clarify if you can

[@KerryEgeler]

You pay sales tax on sales made inside your state. No sales tax on sales made outside your state unless you have an office in that state. There are a few exceptions, but this is the case for the vast majority of small businesses.

[@alexg8842]

@@KerryEgeler thank you for the clarification and fast reply , just subscribed 👍🏽

[@alexg8842]

@@KerryEgeler Hey I have another question so my supplier that I use is located in New York and I’m located in Texas but every time that I make a transaction through his store for me to drop ship they charge me A percentage in Sales Tax When we’re shipping to different states , But as you said I can only charge sales tax With transactions in my state So I don’t charge any sales tax out of state, How does that work?

[@phouathao1853]

I love your videos! You make the Steps so easy and simple!! Keep up the Good Work! I would love to continue supporting your channel!

[@KerryEgeler]

Thank you so much!

[@rodri12509]

Wow, this info is gold. Thank you for dropping these gems.

[@DiamondLifer]

So I have a question. Do I charge the customer sales tax in other states where i am not paying sales tax to that state? I’m operating out of California so obviously I’d collect sales tax for anything sold in California but what about the other states?

[@MirahLov3]

Wow thank you! Super easy! I’m so happy I found your video.

[@KerryEgeler]

You’re very welcome! Thanks for watching

[@TienNguyen-np6ol]

Hi Kerry, this is such an amazing video. I just want to confirm that I only need to collect sale tax in my state only? Thank you!

[@KerryEgeler]

That is correct, but double check your state

[@mbagley3618]

Kerry this is golden..you gotta be the goat!

[@ginnysilver]

3:38 It is against the law to collect sales tax "just in case" - you MUST hold a seller's permit for the state you are collecting sales tax in, files sales and use tax returns, and remit that sales tax. Do not follow this advise - completely incorrect and harmful to viewers.

[@ZwyczajnieKonrad]

Kerry, that was a life saver of a video 💙 Just one question as I am planning on launching my Shopify store from overseas (Europe). Is there some automated way to determine whether I have an economic nexus already established with some state? Or I should set up all the states from day one with tax jar on board? Or am I simply overthinking? 😜 Thx for response 😉

[@RestWellSupplyCo]

Asking to know for sure... I run my business in Texas. I've sold and shipped items to customers in WA and they were not charged sales tax. Is this normal? No states outside of Texas will be charged tax?

[@KerryEgeler]

Yes this is totally correct and normal

[@EvacTheGreat]

so I don't have to buy a sales tax ID for all the states I sell to because my business is not actually there?

[@KerryEgeler]

That is true

[@RR-js4nl]

Binge watching your channel. To the point information! Just subscribed 💪🏻

[@KerryEgeler]

Thank you! 🕺🏻

[@paigegeidel8978]

Thank you for this insanely helpful video!!!

[@iva6433]

Aside from physical location economic nexus should be considered as well and if you have remote employees you might have nexus as well. I would not recommend to collect sales tax before you have permits from state to do so.

[@markoceki]

Definitely learned some valuable info here. Thanks boss man

[@KerryEgeler]

Thank you for watching!

[@tiki8003]

what a fucking blessing you are... this is the first time ive had a shopify video go smooth because we are in the same state, thank you

[@KerryEgeler]

Glad to here that!

[@AuthenticVibe]

Giving me a lot of hope goin forward w my website

[@johntrexler5164]

Super helpful man! Thanks a bunch!

[@KerryEgeler]

You’re welcome!

[@BaileesWRLD]

thank you so much seriously I subcribed

[@Joepiii]

I still don't get it. So do I only choose my state when collecting tax? What about they are from different state purchasing to my website? Do they still get charge for the tax?

[@alice.L.]

Please explain how to calculate taxes on shopify page if customers buy stuff from another countries instead and not only in one as a business owner who lives in one home country?

[@KerryEgeler]

You don’t charge tax or pay tax on these sales

[@nardu]

Hi Kerry, thanks for the useful video. There's a section in the settings now where you need to categorize your products, which seems super important, since each product category has a different percentage. Have you covered this in a different video?

[@gefflee6518]

We have to collect sales tax for in state and out of state for TN

[@LilTrapFR]

Do I still collect sales tax if I just plan on selling under my ssn and not get a LLC ? And what happens if I don’t collect sales tax ? How do I pay the sales tax that I collected if I operate my business under my ssn and don’t plan to get a LLC ?

[@pamelalande1713]

You have the best videos. Thank you. I live and I am incorporated in the state of Montana. Montana does not have sales tax, but I sell to people on shopify in other states. I think I understand you are saying no, I only charge sales tax for the state I live in. So if MT has no sales tax, then I don't charge sales tax to anyone?

[@ginnysilver]

3:38 It is against the law to collect sales tax "just in case" - you MUST hold a seller's permit for the state you are collecting sales tax in, files sales and use tax returns, and remit that sales tax. Do not follow this advise - completely incorrect and harmful to viewers.

[@RitaSmith-ei6ot]

What about print on demand? I am in FL but the company that makes the item and mails it to the customer is in California.

[@KerryEgeler]

If you're looking for a print on demand provider that would be shipping closer to your customers, Gelato is a great option. They have numerous locations globally, and therefore faster shipping time.

[@nolashtheartist]

what if your shop is in Canada and you're selling in the states?

[@johnsonmaleka]

This was helpful thank you

[@gggooogggttt]

Great informative video, thank you! I'm still unclear on other states sales tax though...I'm based in AZ so I would set up my state sales tax collection and remittance here. But if I sell to other states, do I not need to collect sales tax at all since I don't have a physical presence there or only when I reach each state's threshold of sales/income?

[@KerryEgeler]

Correct, Shopify will automatically collect sales tax on sales within your state. Check local laws in your state, but generally will not need to collect sales taxes in other states until you reach their threshold.

[@SM-cn4ek]

Thankyou so much, such great video, very helpful

[@KerryEgeler]

Thank you for watching

[@GymActionchannel]

In 2022 do I still need to pay sales tax on products in my state

[@KerryEgeler]

Yes

[@fuegosthekid3200]

Ayyyyeee Oklahoma Gang 🫡

[@KerryEgeler]

🔥🔥 Tornado crew

[@saudahn]

Thank you so much. Straight to the point and well explained.

[@KerryEgeler]

You’re very welcome!

[@ginnysilver]

3:38 It is against the law to collect sales tax "just in case" - you MUST hold a seller's permit for the state you are collecting sales tax in, files sales and use tax returns, and remit that sales tax. Do not follow this advise - completely incorrect and harmful to viewers.

[@Aryysix]

Well when your adding your EIN to Shopify it asks how the business is registered and if that's not correct because you told someone to create and LLC after they can't make sales.

[@KerryEgeler]

This isn’t true, just put your social security number and sole proprietor and move on. Shopify even states you can do this

[@bigred4994]

What if all our sales come from other states. I'm in Texas. If no one in Texas buys from me do I still file or file zero.

[@shakeilanicholls7020]

Thank you so much for this video. Just wanted to know. I registered my business because I thought I needed to right away. And Im goin to have to pay 3 months before I’m anticipating to launch. What happens if I haven’t started my business before the time needed to pay back?

[@KerryEgeler]

Usually if your business is registered, then the state will want you to pay sales tax on the sales you’ve made. Hope this helps 🙏🏻

[@Preserver-mn6bj]

So When do I need to get a sales tax permit or do I even need one if I use Tax Jar?

[@alenaplokhova1]

Guys, I don't have a company and tax ID, can I just enter my social security ? Or I don't understand how it works? Sorry I’m sooo confused 😢

[@andrewharbert5638]

Question, Shopify changed the UI on the site a lot from the example you have here. By default, the automatically selects Shopify Tax, which has a fee, would we be able to select either Basic Tax or Manual Tax? Seems like a bad idea to have Shopify Tax that has a fee and TaxJar which also has a fee, so we would be charged twice. So trying to figure out this new setup.

[@KerryEgeler]

Shopify tax is free under $100k of sales. Shopify tax does not file your taxes for you, it simply generates a report for you (which does help). The reason you would consider TaxJar is for one reason - AUTOFILE. The filing process is probably my least favorite thing to do as an entrepreneur of all time. I would pay 10x what Taxjar charges to not have to manually file my sales taxes. TaxJar automatically does your sales tax for you through their autofile feature. It’s incredibly helpful.

[@OlayiwolaAAlara]

Thanks for educating.

[@KerryEgeler]

Thank you for watching!

[@OlayiwolaAAlara]

@@KerryEgeler Let's meet up and rub minds if you're ever in New York. God bless.

[@dreashavon]

Thank you! Great video!

[@KerryEgeler]

Thank you for watching!

[@augustodemattos]

Hey Kerry, thank you so much for this video!!!!

[@KerryEgeler]

You’re very welcome!

[@Xynor02]

Shopify taxes works by Billing address or shipping address?

[@tomc.a8956]

Does this work also for canada the « you only pay taxes for people in ur state »

[@Mrpersondjrhjsjsj]

Does taxjar deal with sales taxes and income taxes? Thanks 😁 Most helpful video I’ve seen on taxes! Edit: is there a better substitute for taxjar since after looking through reviews their service seems to be terrible now then it was before… thanks.

[@KerryEgeler]

If you don’t use an app, you can do it manually. When I was doing it manually, it would take me 3-4 hours on average in one sitting to process my sales taxes each month. This could be quicker depending on how good the system is in your state. Oklahoma stinks.

[@PierreCalifornia]

What if there buying from NY and I’m in CA cause taxes don’t pop up in check out ?

[@anjadeichmann]

Great video! Have the rules changed for/in 2022? If so, do you have an update for us? Thank you. :)

[@KerryEgeler]

As far as I’m aware, this process is still current!

[@brennenvestal5173]

All great useful information. Could you possibly do a video about charging VAT for small businesses?

[@KerryEgeler]

I’m not familiar with VAT

[@albertoruiz7793]

What about adding sales tax on other states? Would you have to add every single state individually and get a sales tax permit for every single state?

[@KerryEgeler]

Look at local laws in your state, but typically you only collect sales tax from sales made inside your state.

[@justminding5661]

Do I have to pay sale taxes if I sell little? I dont have an llc i just have my EIN. When will it be good to get an llc license? After selling a lot? I hope you can answer thanks

[@KerryEgeler]

If you’re selling a very small amount, I probably wouldn’t worry about it right away. But don’t take this as professional advice, you might want to talk to a CPA.

[@freddymalki]

Hey Kerry, is the sales tax id # the same as an EIN (for the state you are incorporated)?

[@jaschirag924]

Bruh, I have Hawaiian LLC, but planning to have a virtual office in Florida, is that state part of the Tax Nexus? By the way, love your snappy and straightforward explanation man. Subscribed!

[@KerryEgeler]

FL has no state sales tax at all!

[@_._Cynda_._]

Hello, thanks for this video. So do I have to report sales in other states? Or just report sales from within my state?

[@KerryEgeler]

Look at local laws in your state, but generally you only collect sales tax from sales made inside your state.

[@kositakis0617]

if i dont live in the us but still sell in the us, is there any difference with the steps i have to take?

[@confidenceovercomparison]

INSTANT FOLLOW THANK YOU! just launched today and was confused about this topic thank you!!

[@Martin1519]

Correct me if I’m wrong, but when running a Shopify print on demand store, are you paying taxes twice on one product? Once when the product is purchased from Printful or Printify, and again when it is sold to the customer shopping in my Shopify store, since we have to collect tax for the irs as well as pay it since we are middlemen right? Sales tax is 7.84% in my state, so if this is right then I could be looking at a total of 15.68% sales tax total for my state for each product I sell. I’m trying to figure out how to price my products, and this thought crossed my mind.

[@ZinkPR]

What if I did that and the sales tax didn’t appear is it that we dont see it?

[@user-kw7ps8ju2o]

what if i don't have a business license ? btw i live in afghanistan and we dont have taxes here ! so do i still need to add up shopify taxes ???

[@itsTashaQ]

Thanks so much for this video!!!!! Do purchases on other states will not be taxed? But do we still have to pay tax on them?

[@pabloherrera7049]

Thank You, Great information.

[@KerryEgeler]

Very welcome!

[@QueenMB649]

Should I make sales before setting up sales taxes on shopify to collect?

[@tomamerman7699]

many states have a nexus of 200 orders OR $100,000 in sales

[@KerryEgeler]

Thanks for the info

[@AQUARIUMFREAK123]

Did you say that if i live in NY and i sell my sculptures in another state ... that sales tax is not included in other states .... saving that money.. is that right.

[@KerryEgeler]

If taxes are to be charged in the state where your customer is located, Shopify will add it to the order.

[@AQUARIUMFREAK123]

@@KerryEgeler THANKS, are you familiar with ECWID... it is another selling sight.. They have a free plan but it does not come with TAXES CALCULATED automatically... only the paid plans on ECWID... it seems like their free plan is a little inadequet if it does not help with taxes calculated automatically.. I cant imagine selling in a STATE where taxes are not going to be charged.

[@danielwall1277]

If you run multiple shopify stores in the USA, do you know if these stores combined have to pay sales tax in other states when they all hit the threshold of sales in a state? or is it by each store hitting the threshold individually? thank you

[@KerryEgeler]

Your business as a whole would need to hit the threshold unless you have them setup as completely separate businesses.

[@OnlineIncomeSisStar]

Hi - do I need to file for California sales tax ID if I’m selling digital downloads products by sending them a PDF similar like Etsy ? I have nothing physical or no inventory . I’m just an individual selling planners , ebooks , and templates on Canva . Thoughts ?

[@KerryEgeler]

I don’t believe so, but you definitely want to consult the state of CA on their rules for this, as some states do require sales tax on digital items.

[@stevenvetri]

Okay so I’m based in PA. If someone from say New York or Florida buys something they don’t pay any tax on the product but people from PA will pay tax? I used big cartel before shopify and on every product I just put the clothing tax code and everyone would pay taxes regardless the state besides states like Jersey who don’t pay tax on clothing. Let me know thanks!!