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  • Tax web and brick & mortar

    I have a few tax questions concerning web and brick and mortar
    transactions. My company has both a retail (brick & mortar) store and
    we are looking to see over the internet as well now.

    Scenarios - Does the buyer have to pay sales tax?:

    1. I'm located in GA and someone who also resides in GA purchases a
    item through my website that is mailed to them.

    2. I'm located in GA and someone who resides outside of GA purchases a
    item through my website that is mailed to them.

    Thanks for any help. I'm just un-clear on how the sales tax things
    works with regard to web transactions.


  • #2
    Tax web and brick & mortar

    In article <[email protected]>,
    "Voss" <[email protected]> wrote:
    I have a few tax questions concerning web and brick and mortar transactions. My company has both a retail (brick & mortar) store and we are looking to see over the internet as well now. Scenarios - Does the buyer have to pay sales tax?: 1. I'm located in GA and someone who also resides in GA purchases a item through my website that is mailed to them. 2. I'm located in GA and someone who resides outside of GA purchases a item through my website that is mailed to them. Thanks for any help. I'm just un-clear on how the sales tax things works with regard to web transactions.
    An Internet business has to collect sales taxes for the states in which
    it has a business nexus (usually meaning a physical presence). So if
    your business is located in Georgia, then you have to collect Georgia
    sales tax on any purchase made by a Georgia resident or shipped to a
    Georgia address.

    If your business has no locations (branch offices, stores, etc.) in
    other states, then you would not have to collect sales tax for any other
    state.
    --
    D.F. Manno
    [email protected]
    "The country we carry in our hearts is waiting."

    Comment


    • #3
      Tax web and brick &amp; mortar

      Voss wrote:
      I have a few tax questions concerning web and brick and mortar transactions. My company has both a retail (brick & mortar) store and we are looking to see over the internet as well now. Scenarios - Does the buyer have to pay sales tax?:
      I will answer on general grounds. GA may have some specific aspect to
      the law which invalidates my answers partly or wholly, but generally
      speaking....
      1. I'm located in GA and someone who also resides in GA purchases a item through my website that is mailed to them.
      Yes and you proceed as if he came in the store.
      2. I'm located in GA and someone who resides outside of GA purchases a item through my website that is mailed to them.
      Maybe, but you don't collect it. Some states demand that purchases made
      this way be taxed using an alternative take. This is called
      'compenstating' tax in NM and 'use' tax elsewhere. So any tax in this
      situation would not be something to involve you.

      A Web search using Teoma or Yahoo or whatever on 'tax +on internet
      sales' will yield many non tech articles for you to read. You can, for
      example, establish a subsidiary in a non-sales tax state and be utterly
      tax free. There is a lot to this - well beyond a Usenet answer.

      -paul
      ianal

      Comment


      • #4
        Tax web and brick &amp; mortar

        "Voss" <[email protected]> writes:
        I have a few tax questions concerning web and brick and mortar transactions. My company has both a retail (brick & mortar) store and we are looking to see over the internet as well now. Scenarios - Does the buyer have to pay sales tax?: 1. I'm located in GA and someone who also resides in GA purchases a item through my website that is mailed to them.
        Yes, buyer has to pay sales tax.
        2. I'm located in GA and someone who resides outside of GA purchases a item through my website that is mailed to them.
        No, buyer does not have to pay sales tax.
        Thanks for any help. I'm just un-clear on how the sales tax things works with regard to web transactions.
        There's nothing special about web transactions. It's the same as
        mail-order. If you have nexus in the same state as the buyer, you
        have to collect (and pay over) sales tax on the purchase. If you do
        not have nexus in the same state as the buyer, you don't have to
        collect sales tax.

        Nexus can be hazy around the edges, but you most assuredly do have
        nexus in the state where your brick & mortar store is.

        --
        Rich Carreiro [email protected]

        Comment


        • #5
          Tax web and brick &amp; mortar

          In article <[email protected]>,
          Voss <[email protected]> wrote:
          I have a few tax questions concerning web and brick and mortartransactions. My company has both a retail (brick & mortar) store andwe are looking to see over the internet as well now.
          Note: 'web' transactions are no different than 'telephone', or 'mail order'
          transactions, insofar a sales tax considerations go.
          Scenarios - Does the buyer have to pay sales tax?:1. I'm located in GA and someone who also resides in GA purchases aitem through my website that is mailed to them.
          Under the laws of almost every state -- I cannot speak with regards to GA,
          specifically -- on a transaction mailed to a state "in which the seller
          maintains a presence", the *seller* is required to remit sales tax to the
          state -- in which the product was delivered, at the rate that *that* state
          charges -- on that transaction. WHETHER OR NOT they collect it from the
          'buyer'.
          2. I'm located in GA and someone who resides outside of GA purchases aitem through my website that is mailed to them.
          Subject to the above caveat, on a sale to an address in a state in which
          the seller does _not_ maintain a presence, the seller is _not_ required
          to collect any sales taxes on those transactions. You *do* have to keep
          records to show the 'local' tax authorities (in the event of an audit)
          that those transactions *were* 'sales tax exempt -- shipped out of state'.

          Note: the _buyer_ in an inter-state transaction where sales tax is *not*
          charged, is =supposed= to pay 'use tax' (at a rate that "just happens" to be
          identical to 'sales tax') on any items that are 'imported' from out-of-state.

          *VERY*RARELY* do buyers report such purchases, or pay those taxes -- well,
          except in the case of automobiles, etc. that require titles, licenses, and
          registration, etc. This 'crime' is rampant, precisely because it is nearly
          impossible for the state to track down the violators.
          Thanks for any help. I'm just un-clear on how the sales tax thingsworks with regard to web transactions.
          As stated above, "just like telephone, or mail-order, transactions."



          Comment


          • #6
            Tax web and brick &amp; mortar

            In article <[email protected]>,
            Paul Cassel <[email protected]> wrote:
            Voss wrote:
            1. I'm located in GA and someone who also resides in GA purchases a item through my website that is mailed to them.Yes and you proceed as if he came in the store.
            Except that you might use the rate where the item is delivered (if, as
            is common, GA has different rates for different locations, such as a
            base state rate, plus differing city/county rates). I know NY does it
            that way.

            Seth

            Comment

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