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The e-commerce.

trying to get sales tax working on per state basis


psavage

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Why are you charging sales tax for each state?  Do you have a physical store in every state?  If not, you should only have to charge sales tax for the state you are actually located in.

 

 

My current level of understanding is that one needs to charge tax based on the state the product is being shipped to.

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My current level of understanding is that one needs to charge tax based on the state the product is being shipped to.

 

I am located in Alabama and I know that someone only needs to charge Alabama sales tax if they have "NEXUS" in Alabama, meaning the presense of a physical store, distribution center, or sales team, etc.

 

Otherwise, individuals are expected to pay a "USE" tax on any product they receive but have not paid sales tax on, but who does that?

 

Here is the exact wording from the Alabama Dept. of Revenue website:

ARE SALES OF GOODS MADE VIA THE INTERNET TAXABLE?

Yes. ON-LINE RETAIL SELLERS LOCATED OUTSIDE ALABAMA: The retail sale of goods made over the Internet that are delivered into Alabama from an out-of-state seller are treated the same as the retail sale of tangible personal property made through more traditional channels, with the same ?nexus? rules applying to both. A retail vendor has ?nexus? in Alabama if they have a physical presence in Alabama, such as a retail store, warehouse, inventory, or regular presence of traveling salespeople or agents, or has established remote entity nexus. If the retail vendor has nexus in Alabama, the tax reporting responsibility lies with the retail vendor to register with the ADOR to charge, collect and remit the appropriate Sellers Use Tax to the ADOR (Local sellers use taxes also apply and should also be charged, collected and remitted to the appropriate administering authorities). If the retail vendor does not have nexus with Alabama, the tax reporting responsibility passes to the consumer/purchaser and they would be responsible for self-assessing the use tax and remitting it via a consumers use tax return to the ADOR and to the appropriate administering authorities.  (To report use tax to the state, file and pay the Consumers Use Tax Return electronically through the Alabama Paperless Filing & Payment System.  If you do not have a valid consumers use tax account number, and only need to report and pay on an occasional basis, click here for a downloadable return.)  However, please note that some retail vendors that do not have nexus in Alabama elect to register with the ADOR on a voluntary basis to charge, collect and remit the use tax to the ADOR as a convenience to their customers.

ON-LINE RETAIL SELLERS LOCATED IN ALABAMA: The retail sale of goods made over the Internet by Alabama retailers to Alabama customers are subject to Alabama Sales Tax. The tax reporting responsibility lies with the Alabama retail vendor to charge, collect and remit the Sales Tax on such sales, as these sales are treated the same as the retail sale of tangible personal property made through more traditional channels. Local sales tax or use tax also applies and should be remitted to the appropriate administering authorities.

 

IF ALABAMA RESIDENTS PURCHASE ITEMS THROUGH MAIL ORDER SALES OR OTHER DIRECT MARKETING ALTERNATIVES, ARE THESE SALES TAXABLE?

Yes. Retail sales of tangible personal property delivered into Alabama from an out-of-state location are subject to Alabama use tax, regardless of the method of ordering the item - i.e. via mail-order catalogs, cable tv shopping, the Internet, by telephone, etc. If the out-of-state seller has ?nexus? in Alabama, the tax reporting responsibility lies with the retail seller to register with the ADOR to charge, collect and remit the appropriate tax to the ADOR. (A retail vendor has ?nexus? in Alabama if they have a physical presence in Alabama, such as a retail store, warehouse, inventory, or regular presence of traveling salespeople or agents, or has established remote entity nexus.) If the retail seller does not have nexus in Alabama, the tax reporting responsibility passes to the consumer/purchaser and they would be responsible for self-assessing the use tax and remitting it to the ADOR via a consumers use tax return. (You can download a consumers use tax return by clicking here.) However, please note that some retail vendors that do not have nexus in Alabama elect to register with the ADOR on a voluntary basis to charge, collect and remit the use tax to the ADOR as a convenience to their customers.

 

I would imagine you will find the same in all other states.

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