Sales Tax – What Do I Need to Know About Them

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Sales tax returns are due tomorrow!

What do you need to know??Β πŸ€”

πŸ—½ State Matters πŸ—½

Sales tax is governed by individual states, each with its own rules. No federal sales tax, but plenty of state and local variations.

🀏 Nexus Awareness 🀏

You collect sales tax where you have “nexus” – a connection to the state. It’s not just about physical presence; it can include employees, inventory, and more.

πŸ“œ Permit First πŸ“œ

Always register for a sales tax permit before collecting tax. Check with the “[State] Department of Revenue.”

πŸ›οΈ Channel-Agnostic πŸ›οΈ

Collect sales tax on all channels, regardless of where you sell – retail, online, or through marketplaces.

πŸ”’ Rate Realities πŸ”’

The tax rate depends on the state and whether it’s origin-based or destination-based. Exemptions vary, so know your products.

πŸ’» Filing Frequency πŸ’»

Higher sales volume often means more frequent filings. States assign a filing frequency when you register.

πŸ—“οΈ Due Date Dynamics πŸ—“οΈ

Due dates vary by state; some are on the 20th, others on the last day of the month. Check with your state’s Department of Revenue.

🚫 Zero Return Rule 🚫

Even if you didn’t collect sales tax, file a return. Don’t risk penalties or license revocation.

πŸ’° Timely Pays Off πŸ’°

Some states offer discounts for on-time payments, so stay informed about potential savings.

😌 Resale Relief 😌

If you’re reselling products, explore resale certificates to avoid paying sales tax twice.

Navigating sales tax may seem daunting, but mastering these basics sets you on the path to compliance and financial success.

Need help? Reach out!

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