Wednesday, February 16, 2011

NYS sales tax information

Hi-- I posted almost exactly this post on one of my Etsy teams (Empire State Team)... and similar information is in one of my other posts-- way back on 8/28/10. A couple etsians had questions and this is how I answered them. And really- if you work for NYS sales tax-- please comment here... I would appreciate it.  I really try my very best to be as legal as possible.. there is no point not to be. And i keep very good records.

So-- here it is....

 I can tell you what I do and then you can always call NYS or your accountant for more help- or see what others do here.
My information comes from my years of selling and knowing another crafter at shows who works for NYS sales tax & also calling them with questionsand my own accountant.

I add tax on after the fact. I sell in different tax locations in NYS. I put price tags on everything- and add the tax to the sale. You are supposed to charge the tax to where your customer lives or where the craft show is. I bring pennies and small change to the craft show.. that works for me. BuT I also understand that it is ok to put the tax into the price of the sale- I think you have to have a sign or at least tell people that the price includes tax. And then you have to back it out of the sale, so you know what to pay NYS.
I bring a receipt book with me- it works well for me- even when I am super busy at a show--people wait. I itemize the receipt and show the tax. Given them their copy and I have one. I put my buisness name on the receipts and the date. (and some customers do walk away with out their receipt- I still have my copy and that is what counts).
But I think you can just keep a tick sheet- what ever works for you-- as long as you know what you did so come tax time you have your ducks in a row.

I do know that you can have Paypal add the tax in-- but I believe like etsy/ebay they only have 1 tax option--which is not super legal- but it is the best you have. Since you are supposed to charge where the person lives. If it is more- then you have to pay the extra out your pocket and less- then you should refund the customer the extra.

Because I also sell on ebay-- I don't use that option on paypal. Etsy has at least started to let you put it on the invoice a tax rate. Hopefully your customer pays the rate of where they are.

Best case is that you get to bill the customer and then you tell them which tax rate to pay-- there is a NYS web site.. and this can tell you what their tax rate is. Also be aware that NYC has different rules when it comes to taxes- there are somethings that they just don't pay tax on- and you can't charge them.

Either way- you have to know what tax district your customer is in- so you can report it as tax received on your state sales tax filing form.

You only collect sales tax for your customers shipped to a NYS address.

I guess my point is that it is the law and it really does not pay to be illegal about it. The rules are easy to follow. They can be confusing the first time- just go slow and read up on it. It does get easier. And call them-- they are always super friendly the times I have called.

Hope this helps. Please tell me what you do....


  1. Very useful advice! I've seen lots of questions about this on the Etsy forums today!

    -Tiffany with Will Write 4 Food



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