Some states charge sales tax on the things you buy, and some chargeWe follow the rules implemented by each individual state. Where sales tax is applicable, it will appear on your online order form and on the invoice included with your order. State sales tax may be added to all orders shipped to: Alabama, Arizona, California, Colorado, Connecticut, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Maryland, Maine, Michigan, Missouri, Minnesota, North Carolina, New Jersey, New Mexico, Nevada, New York, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, We do not charge sales tax when you buy an Online Gift Card or eGift Card, because tax gets charged when the gift card is used. Please note: Tax is not calculated until the date your order ships. This may affect your qualification or participation in tax-exempt sales. New Balance is required to collect tax on orders shipping to the following states: AL, AR, AZ, CA, CO, DC, FL, GA, IA, ID, IL, IN, KS, KY, LA, MD, ME, MI, MO, MS, NC, ND, NE, NM, NV, OH, OK, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, WY.
We are also required to collect sales tax on orders shipping to CT, MA, MN, NJ, NY, and PA (in these states exemptions may apply). New Balance does not benefit in any way from the collection of sales tax. All collected tax is remitted directly to the appropriate taxing jurisdiction. eGifts and Gift Cards - No sales tax is charged when buying New Balance eGifts or Gift Cards. The appropriate sales tax will be charged on the purchase when the eGift or Gift Card is redeemed. You're headed to the US Site... Pricing and product availability may change.Download article as a PDF Whether you have to pay sales tax on Internet purchases is a common question in a world where consumers buy everything from clothes to food to cars online. Some people view the Internet as the prime place to start selling items that are free from sales tax. Indeed, many online retailers often lure customers in by advertising that any purchases made will be free from sales tax. However, there are often cases where Internet sales are indeed subject to state sales taxes.
Where the Buyer Is Located Generally speaking, if an online retailer maintains a physical presence in a state that charges a sales tax on most purchases, then that online retailer must charge sales tax on any items that are sold to customers within the home state. However, if the online retailer is selling an item to a customer outside of its home state, then it is not required to collect sales tax from that customer. For example, suppose that Pete, who lives and works in California, likes to buy all of his cooking oils and spices for his restaurant over the Internet. He normally orders from a company that is headquartered and has its warehouse in Nevada. Because Pete orders his supplies for his restaurant from a vendor that is outside of California, the company does not have to charge Pete a sales tax. However, now suppose that the company has opened a warehouse in California to better supply their regular customers there. Now, because Pete's order will be taken and shipped from California, he must be charged sales tax on his order.
How Do Large Websites Avoid Sales Tax on Internet Sales? Large websites avoid sales tax by establishing subsidiaries that are solely responsible for the Internet part of the business model. For example, the store that you buy an item from online may be a different legal entity from the corresponding brick and mortar store that is in your local shopping mall. Because that particular online store does not have an actual physical presence within your state, it does not need to charge you sales tax. This is a highly controversial practice that will probably be legislated in the future as many brick and mortar stores that do not have online counterparts are losing sales to the tax-free internet shops. However, this issue becomes even more complicated when the online retailer allows a customer to make returns to a brick and mortar store that is technically a separate legal entity. Consumers will buy an item online that is free from sales tax, but are then able to return those purchased items to brick and mortar stores.
Consumers May Be Required to Report and Pay Sales or Use Taxes For consumers that order tax-free items online, but live in states that charge a sales tax, they are technically required to report that purchase to their state tax agency and pay the sales tax directly to the agency. When consumers are required to do so, it is often called a "use" tax. The sole difference between a sales tax and a use tax is the person that ends up giving the money to the state government. When it is a sales tax, the retailer is the one handing over the money, while a use tax is handed over directly by the consumer. However, collecting use taxes on small purchases often costs more than simply letting the consumer not pay the use tax. Instead, state tax agencies try to focus more on collecting use taxes for big ticket items that are purchased online with no sales tax, such as cars and boats. Be aware, there are a number of states that have stepped up their enforcement of their use tax laws and are now trying to make their state residents pay the taxes that should be paid.
Get a Free Evaluation of Your Internet Sales Tax Issues For retailers and particularly Internet-based retailers, tax issues can get pretty complicated. If you have questions or concerns about how to properly comply with the tax code, you may want to consult with an attorney. Get started today with a free legal evaluation of your sales tax issues from a local tax lawyer.Do I need to collect sales tax when I sell my craft goods? If I sell handmade items on a website, do I need to collect sales tax from the buyers? I live in Pennsylvania, but buyers could potentially be anywhere in the world. Also, if I were to sell the same items in person at a craft fair, would I have to collect sales tax for those transactions? First, I would recommend the crafter get a copy of the PA Sales Tax guide (rev-717) which outlines in great detail the items subject to sales tax and items not subject to sales tax. The test is not whether an item is handmade, but what the item actually is.
For example, if you are making wearing apparel, it may not be subject to sales tax. However, certain wearing apparel can be subject to sales tax: Belts and shoes are not taxable, but bridal apparel and accessories are taxable. Leather gloves are not taxable, but sheepskin, fur, or rubber gloves are taxable. Publication 717 will be your best guide to make sure you are in compliance with sales tax collection law. If your items fall within the taxable category, then you must collect Pennsylvania sales tax on sales to any resident of Pennsylvania. This includes items sold at craft fairs in the state, as well as items sold via the Internet, direct mail, or telephone to in-state customers. Goods delivered to out-of-state customers are not subject to Pennsylvania sales tax. Don't forget to keep good records to prove out-of-state sales. I would suggest contacting a local CPA to help you set up this accounting and reporting system. When in doubt about sales tax or other Pennsylvania tax questions, you can reference similar questions answered by the Pennsylvania Department of Revenue.