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So I only started setting up sales tax collection on applicable listings a few days ago, and today I had my first in-state sale since then where sales tax is applicable (and configured by me in the listing). What happened when the order came in (for a set of plates) is not what I expected. I expected to get that sales tax money deposited into my paypal account, and then file a quarterly sales tax return at which point I would remit the total sales tax for that quarter to the state. I was not looking forward to this process, but I was preparing myself. But instead, it appears that ebay has taken the tax money and is going to remit it for me. But I don’t live in Washington state or any of the other states that ebay says that it collects tax for. I live in NY, which recently did pass a law requiring ebay to do the tax collecting and remittance, but implementation of this collection is not on ebay’s schedule published here:
https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121#section4In fact, I had contacted the ebay for business facebook people a few days ago to ask about when they might implement tax collection for NY state, and they said they had no information to provide to me on this. I may contact them again with what I’m seeing on this order, but I absolutely refuse to call regular ebay customer support about it, in order to preserve my sanity.
The other weird thing about this is that the amount that ebay collected (which I can only find out by doing a “download report”) is different than I specified in the listing. Price + shipping comes out to $60.79, and I set up a tax rate of 8%, so the tax should be $4.86. Ebay collected $4.49, which is 7.4%. That may be the correct rate for the buyer’s county, which would be great, and would lead me to believe that ebay, despite not announcing it, has implemented tax collection and remittance for my state, which would be fantastic. But then I checked other in-state orders in the last few months that qualify for sales tax but for which I didn’t configure sales tax collection in my listing, and ebay didn’t collect any sales tax for those, so that convinces me that they haven’t implemented the same thing for NY that they did for Washington state.
So, any NY state sellers out there who can clarify things for me? Or is this how sales tax has always worked on ebay? Was my expectation that I would receive the sales tax funds incorrect?
If ebay is remitting the tax to NY, do I still have to file a quarterly return?
Perhaps ebay only collects (the correct) sales tax when I set it up at the listing for at least some percentage, in order to avoid collecting sales tax for hobby sellers?
If you’ve made it through my entire wall of text, thank you – I don’t know how to explain my confusion more concisely.
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I checked and the sales tax rate ebay used IS the correct rate for the county the buyer is in. So that’s great news and answers one of my questions. I wonder what would happen if I set up sales tax collection for clothing – would it know
a) not to charge any tax at all for some counties for items where my asking price is over $110 but the best offer sales price comes out to be less than $110?b) would it know which counties DO charge tax on clothing less than $110?
Still confused as to why it’s only collecting when I configure it to collect tax – maybe that’s temporary. Sent another message into ebay for business on FB – maybe they’ll be able to get more info this time.
If only ebay followed software industry best practices and published release notes…
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Just heard back from ebay for business FB folks (ATTENTION NY-BASED SELLERS):
We’re sorry for the lack of communication, we’re looking into updating our announcements, but yes we are collecting sales tax in accordance with applicable state law. You don’t have to collect it and pay it to the state of New York. These changes just went into effect on June 1st.
Can’t decide if it’s a lucky or unlucky coincidence that this happened at the EXACT same time I decided it was time for me to start collecting sales tax. I guess I’ll go with “lucky”, b/c even though I wasted a few hours trying to figure this out, I think this means I don’t have to file a sales tax return ever.
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To close this out, in case some NY-based sellers are reading this, here’s the very latest info from NY state about the process:
https://www.tax.ny.gov/pdf/memos/sales/m19-2s.pdf
You still have to file a sales tax return, but specify all ebay sales as non-taxable, and ebay has to provide you with a form ST-150 to keep for your records as proof as to why you didn’t collect or remit any tax.
So it’s a teensy bit annoying to have to file a return, but it’s fantastic that it takes away the need to have to figure out the sales tax rate for each buyer’s county.
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I’m sort of running into the same confusion. eBay just started collecting for NJ in May. Once the second quarter ends, I have NJ sales from April and I think beginning of May that I will still need to report and pay online. I’m not sure what I need to do with the in-state sales after they started to collect tax; I’ve been assuming that I do nothing.
I noticed that the tax information for the first two eBay-handled sales were loaded into GoDaddy as uncategorized. I haven’t tried to figure out what I should be doing with that.
Anyway, I’m going to have to make a few phone calls. I think I would prefer to call GoDaddy over eBay.
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I wouldn’t want to call GoDaddy or ebay. I suggest calling your NJ sales tax authority. When I called the one for NY today, the call got picked up right away by a person who knew exactly what I was talking about and helped me out quickly and pleasantly. Hopefully it’s the same in NJ. 🙂
I’ll go check GoDaddy now that you’ve alerted me to these new line items, but I expect that I’ll just create a new non-business expense category for sales tax and configure GoD to categorize the sales tax line items that way.
In NY they are firm about having to keep filing the $0.00 returns.
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Boy, NJ government really doesn’t want to talk to its constituents. I couldn’t find anything but a recorded line on the Dept of Treasury website. I had to use Google to find a phone number. I had to waddle through a recorded menu and wait on hold for about 5 minutes.
The number I called was actually the Dept of Taxation. They told me that I need to file for non-reporting status with the Dept of Revenue. So, now I have to call that department to see what I need to do. I’ll wait until after I pay the 2nd quarter sales tax.
Anyway, GoDaddy uploaded sales tax entries from eBay. I have to call either GoDaddy or eBay to understand why those are appearing in my account. I don’t even see them in eBay.
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Sharyn,
I found something that might help you at least with NJ:
https://support.taxjar.com/article/631-new-jersey-sales-tax-filing-update-november-2018It says:
If you are an in-state seller or seller with a physical presence in New Jersey AND:All of your NJ sales are sold through a Marketplace that is collecting and remitting NJ sales tax on your behalf OR all of your sales are tax exempt or sold for resale, you’ll also need to register (or remain registered), but you can also ask the state to place you on a non-reporting basis by completing Form C-6205-ST and mailing it to the Division.
The form you have to complete looks pretty simple:
https://www.state.nj.us/treasury/taxation/pdf/other_forms/sales/c6205st.pdf -
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