I feel like you didn't address the most common scenario which is that someone is selling digital products across the whole US (or the world for that matter) from a state that collects sales taxes on digital products. For example, I'm in Utah and I want to sell digital products via etsy or another platform to anyone and everyone that has access to that platform.
I was looking for that information as well. I actually found the answer under Kate Hayes TH-cam channel "How taxes work for Etsy sellers (etsy finances explained.
Some customers dont even put their address when buying a digital product since it requires no shipping. So i’d have no idea even where that customer is...
Are “sales taxes” and “use taxes” the same thing? I thought in some states “use taxes” were put in place to capture “catalog sales” out of state (before the internet) and subsequently that unless a state has sales tax for digital products specifically that most of digital sales falls under the “use tax” rules.
Not really. Generally speaking, sales tax is collected by the seller and sent to the state taxing authority. Use tax is paid by the consumer of products that they did not pay sales tax on, but should have. So let's say you buy a car in Delaware where there is no sales tax, but you live in a state where there is sales tax on cars. When you register the car in your state, the state will require you to pay use tax on the vehicle before you can register it.
Hi Jim, I live in Europe and majority of my sales happen all over USA (no idea about state). In July i made 1700$ in sales maybe 800$-1000$ came from US. I got automated message from Stripe that i exceeded tax threshold (probably in US) and i need to collect tax now. Any advice on where can i start?
Feel free to schedule a call and we can discuss. I'm not sure. It could be tied to the fact that you live in Europe and are responsible for VAT. hawthornlaw.net/consult
It sounds far too complicated to keep up with and continue doing all the other jobs an entrepreneur has...but there are remedies: there are plugins you can get for websites; Shopify and Etsy do some of the heavy lifting; if you do an internet search for these things and use strategic terms in doing so, you'll find some automated remedies that may work for you.
I heard that an attorney offering consultation online does NOT pay sales tax. If so, those small individual sellers should not pay sales tax as well. Just because those small sellers are not as "educated" or/and "organized" by some form of union as an attorney/nurses..., they should not be taken advantage of and put on layers of layers of burden.
Here is a link to the checklist referenced in the video... hawthorn-law.ck.page/6a06c3e356
This doesn't work any more.
I feel like you didn't address the most common scenario which is that someone is selling digital products across the whole US (or the world for that matter) from a state that collects sales taxes on digital products. For example, I'm in Utah and I want to sell digital products via etsy or another platform to anyone and everyone that has access to that platform.
I was looking for that information as well. I actually found the answer under Kate Hayes TH-cam channel "How taxes work for Etsy sellers (etsy finances explained.
Some customers dont even put their address when buying a digital product since it requires no shipping. So i’d have no idea even where that customer is...
That’s why it is incumbent on the business owner to ask for that info at checkout
What if a non resident alien sales digital products?
Tons of valuable information, thank you so much. It helped me a lot.
Loved the animations Jim :)
Are “sales taxes” and “use taxes” the same thing? I thought in some states “use taxes” were put in place to capture “catalog sales” out of state (before the internet) and subsequently that unless a state has sales tax for digital products specifically that most of digital sales falls under the “use tax” rules.
Not really. Generally speaking, sales tax is collected by the seller and sent to the state taxing authority. Use tax is paid by the consumer of products that they did not pay sales tax on, but should have. So let's say you buy a car in Delaware where there is no sales tax, but you live in a state where there is sales tax on cars. When you register the car in your state, the state will require you to pay use tax on the vehicle before you can register it.
@@jimhart thanks for the clarification and example - much appreciated!
Thanks for the info. Many of your links are broken, unfortunately
What did you find that was broken? I just checked every link in the description and they all worked fine.
Do the same rules apply to services instead of products?
CA doesn't not sales tax "shipping and handling" only the tangible product, but try pointing that out to a on line vendor who also has stores in CA.
i only want to see online course in EU, do i have to pay taxes? no employees
Hi Jim, I live in Europe and majority of my sales happen all over USA (no idea about state). In July i made 1700$ in sales maybe 800$-1000$ came from US. I got automated message from Stripe that i exceeded tax threshold (probably in US) and i need to collect tax now. Any advice on where can i start?
Feel free to schedule a call and we can discuss. I'm not sure. It could be tied to the fact that you live in Europe and are responsible for VAT. hawthornlaw.net/consult
Didn't see the list for digital taxes. What about Texas.
Here's the link: hawthorn-law.ck.page/6a06c3e356
Thanks!
It sounds far too complicated to keep up with and continue doing all the other jobs an entrepreneur has...but there are remedies: there are plugins you can get for websites; Shopify and Etsy do some of the heavy lifting; if you do an internet search for these things and use strategic terms in doing so, you'll find some automated remedies that may work for you.
ultimately you are responsible, not the plug in.
Is there away I can get in contact with you about llc
I heard that an attorney offering consultation online does NOT pay sales tax. If so, those small individual sellers should not pay sales tax as well. Just because those small sellers are not as "educated" or/and "organized" by some form of union as an attorney/nurses..., they should not be taken advantage of and put on layers of layers of burden.
You pronounced Oregon correctly, you must have lived there or have friends there