Ebay Sales Tax on Everything Now?
 

Well, it appears eBay is now charging sales tax on everything (including items from out-of-state sellers). I live in WA and just got hit up for sales tax from a CA Seller. I tried eBay's "Buy It Now" for 8 different out of state sellers, and all 8 were showing sales tax.

Perhaps this has already been discussed, but I did not realize every purchase (regardless of seller's locale) would be taxed in 2019. In my case, the tax amount varies, but averages just above 10%.

Is anybody else experiencing this same thing?

I just bought and paid for some cards (a few minutes ago) and didn't see any tax from an out of state (to me) seller.

Interesting....

I wonder how they are targeting the people who must pay the tax. My actual purchase + the 8 items I previewed ALL wanted to charge sales tax in excess of 10%. :mad:

I think it has to do with your state. I noticed when I listed stuff that two states (WA and MN I think) were assessing sales tax on my listings if sold to their residents even though I am in CA. You might check with your state's board of equalization.

You’re right. I just got off the phone with eBay, and they confirmed it. Sales tax will be implemented by state, as follows...

January-
Washington
Minnesota

February-
Iowa

April-
Connecticut

May-
New Jersey

July-
Alabama
Oklahoma
Pennsylvania

I’m sure other states will subsequently follow. But that’s as far as eBay would say for the time-being. Bummer :(

You would think that eBay would notify all of its sellers and buyers just what to expect. If it wasn't for this board, I would never have heard a single word about it.

As a test, I went to checkout with a few random things in my cart from a couple of different states (with FL and NC, I believe), and only the ones from California hammered me with tax.

So you must live in CA.

Enjoy the out-of-state purchases while you still can!

Yeah, and when ebay does their 15% off coupons, buying anything from out here would basically negate the discount you were looking to get. Frickin' bummer!!!!!

Don't get me wrong, I'm all for paying taxes when it makes sense....

I understand paying sales tax on NEW things, but for used items and hobby collectibles that are not new, it just doesn't make sense. What could happen is you could buy something on ebay (taxes collected), sell it (taxes collected), the person that buys it from you could sell it (taxes collected). When does it stop. Basically it's a tax for selling anything. Where I live there are things that are tax exempt, for example FOOD. Why can't there be exemptions for USED crap? :confused:

What this amounts to is being taxed on ANYTHING that is purchased, even if taxes had been paid on it before. In my book, that's bullshittt. :mad:

If it's collecting taxes on hobby related materials that is NEW (for example, card pages or holders, etc) then hit me up on taxes, I'm happy to pay them.:o

Buy something on Amazon or ebay that's new, TAX it. :o Buy a frigging baseball collectible that is not new, then leave it the PHUC alone. :mad:

Someone needs to start a virtual/internet "Boston Tea Party". :(

Ahhh. This explains the mystery charge to my PP account. The other day I bought a PC for $7.75/dlvd. The charge showed as $7.75, but then there was a wierd separate mystery charge of $.78, which is WA sales tax (10.1%). I guess the party's over. Tax in HA, now tax on eBay...soon tax everywhere.

Didn't California propose charging tax on every text message? So, who collects the eBay tax and then is responsible for paying it? Please don't tell me the seller.

So as a collector and not a business if I sell something in one of the state's you said do I collect the tax and then have to pay it on a tax form at tax time with my personal taxes? If so looks like I won't be selling anymore and most casual collectors won't either.

Will the tax come from all sellers or just the ones over a certain dollar/item amount per year?

No, your personal taxes are paid to your state. You would either send the cash to that state after filling out their form or, more likely, eBay would do it for you.

Except here in Mass you need to get a sales tax number from the revenue dept. Without it you don't have the right to collect sales tax. With it you do, but you also can file paperwork with a vendor to be exempt from sales tax on items for resale.


So will Ebay handle the paperwork of getting the tax number for me? And filing all the forms which have varying deadlines depending on overall sales?


Or do they collect and send me the tax, which I have no right to collect and essentially no way to pay to the state as there's no resale number to apply the payment to.


The first way pretty much wrecks Ebays claim to be "just a venue"
The second basically forces casual sellers to break state law.

Also, to be entirely correct, ours is a sales and use tax, so if I buy from another state, and Ebay forces me to pay their sales tax, then I'm technically required to pay my states use tax as well. (which has always been true, but I don't know anyone who actually pays that)

If you buy from another state they will charge you Sales tax based on your state and send the tax collected to your state. Hence you don’t need to pay Use tax as they already received it from the sale side of the transaction.

https://www.ebay.com/help/selling/fe...harges?id=4121

seems like some of the states exempt sellers from collecting sales tax if sales to that state are less than $10,000. At least the first two were that way (Minnesota & Washington).

Do you have economic nexus in California?

Effective April 1, 2019, California considers retailers who make more than $100,000 in taxable annual sales or conduct more than 200 transactions annually to have economic nexus. This means the state considers these sellers are now obligated to collect sales tax from buyers in that state.

I always thought you had to be in business to collect sales tax. Guess that's why the states are putting dollar thresholds. Sufficient nexus if $100k or higher...that makes sense...stinks still though.

Per eBay for marketplace responsibility tax states: “Once eBay starts to collect tax in the above states, no action is required on your part, and there will be no charges or fees for eBay automatically calculating, collecting and remitting sales tax”

How many cards do you have to sell each year to qualify as a "dealer" and sales tax exemption. May give you an incentive to buy/sell some cards just to qualify.

Isn't there a form?
Like starting any small business?

In CA you just have to register to get a resale permit. But, if you get into the system two facts apply:

1: You have to file a sales tax return every year or more frequently if the state says to; and

2: You have to track your untaxed buys and remit use tax.

It isn't just a free sales tax pass: if you abuse the exemption and you are caught, you will have trouble.

As this goes nationwide, I'll be interested to see how this affects eBay sales. Seems like a sneaky rollout on eBay's part. At some point buyers will catch on. The question is will they care or will they start factoring it in a la the juice in an AH.

eBay is handling all of the collection and remittance of the sales tax..but, how do they know what is taxed and not taxed in each of these states...my game used jerseys are clothing, and, clothing is not taxed in many states...how do they exclude collection of sales tax for certain items?
I live in a state where clothing is tax free...any game used jerseys I buy, wherever they are from, should not be taxed...

Isn't that just for personal use purchases and not inventory related purchases?

I wonder how long it will be before eBay starts charging for that service?

.

I'm sure that it costs eBay a lot to collect and send the tax to the States. The executives at Ebay are smart. It would not surprise me to learn that eBay has already negotiated with the States to deduct their costs of collecting the tax from their distributions to individual States.

It could be a great deal for both eBay and the States.

With the windfall that the states will be receiving as this internet tax net grows wider even beyond ebay, I wonder if they'll reduce the tax rates? :rolleyes:

Rob M

When I ordered my ebay shipping supplies and paid for them with my quarterly ebay supplies coupon, I was charged sales tax. This quarterly coupon does not cover the sales tax (as indicated in t/c), so I had to use $12 of my ebay bucks to get my "free" ebay s/h supplies. What is weird is I have paid for multiple other things since January 1st, including within my own state, and have not been charged any sales tax anywhere except here. The supplies mailed out of KY, so I am not sure why this state is charging sales tax now. Perhaps this supplies vendor is large enough they are collecting for my home state. Hopefully ebay will change the terms on this coupon to allow it to cover the sales tax on my "free" stuff.

They may now automatically add tax to shipping supplies because they are not generally items you are buying to resell. You are buying them to use them and do not qualify for nontax status.
They used to send me quarterly coupons through my messages and I haven’t received any in a while. I am going to contact them to find my supply money. Thanks.

My state has a $100k (no transaction) threshold for having to collect taxes, so my guess is that they are collecting for my home state. No longer need to claim the value of my free supplies on my use tax filing.


I have not received a message about the ebay supply coupon in a few years. However, you can access your code by clicking on the "promotions" tab and then clicking on "subscriber discounts". Your code will be found when click on "see details" under the shipping supplies box.

Go to: https://www.sd.ebay.com/subscriberdiscounts

Assuming you have an eBay Store subscription, the first item should be a link to your quarterly coupon code for shipping supplies based on your store subscription level.

Funniest post this year
 

That is truly funny. I will more likely see a Chocolate, Rainbow colored, T-Rex-acorn before my state (Illinois) decides they have too much tax revenue and can start lowering rates! But that was funny.

Thank you for that!! I was wondering where my coupon was last quarter!

Rob, of course they will Not. They will just spend more. Many states are already in dire straits (see Illinois), and very fiscally responsible states like California (sarcasm) have vowed to provide global health care to all, including “non citizens”. Most Politicians are morons and they would rather pass laws and spend money than pay down debt and unfunded obligations. It’s like giving a 10 year old a $1000 - you’ll get a bunch of candy and Fortnite skins!

Ok, so if you go to My eBay - under the account tab Manage My Store - then on the left click Subscriber Discounts. Your coupon is there.

We used to get a message from them every quarter when the coupon was available. I hadn’t noticed that it has probably been 6 months since I got supplies. I was assuming they ended the program. They just made it more difficult to cash in on their offering to stores.

Thanks for mentioning the supplies. I am going to use my $50 today. Much appreciated.

I was going to reply to this thread, but when I reached to put a plastic straw in my Diet Dr. Pepper, I was arrested.

Ditto California...................

Personally, I can see some great opportunities for new business in sales tax exempt states. One could create a po box type mail center for buyers in high tax states and then mail the item to the subscriber tax free as this is address based.

Here in Detroit there are many businesses that provide po boxes to Canadians looking to avoid tax and excessive shipping on bought goods and no one bats an eye. I am sure the Canadian tax authorities hate it, but they advertise openly.

I know people are going to jump on this as working the system, but as I consider sales tax on used goods a sham in excess of skipping tax on on those goods...I couldn't care less.

I'm a Canadian using one of those PO boxes to save on the cost of shipping, but I can assure you that I still pay taxes on every item that is purchased. Items still go through the regular import process and taxes are calculated which I am responsible for.

The only real benefit is that the actual cost of shipping is lower - which is still great as I'm probably paying a third of what I used to haha.

That’s classic Frank! I have 3 boys (15, 13, and 10) and Fortnite is bigger to these kids than cards are to us cardboard nuts. I have grow to hate Fortnite, especially when my kids fight me over spending $$ on Fortnite skins. If the states were smart, they would tax Fortnite - I don’t think internet purchases of games that are streamed, or the intangibles purchased on those games (like skins, virtual weapon, extra lives, etc) are taxable yet.

I'm in Illinois and added an item from CA seller to check what you mentioned here. Did not see sales tax added to invoice.

Try that with other CA sellers and see if it is added. I'm out here and once in awhile when I do a test by adding something to my cart, a CA seller won't have the sales tax factored in for some reason. Don't know if it's on purpose or some some sort of crack in the system.

If you live in CA and buy a card from a CA seller, you get taxed.

Yeah, why let facts get in the way...

Attachment 340479

Red box (added from the actual listing) shows item location as California. I live in California, and like I specifically said, sometimes the tax doesn't show up.


Another two CA cards I put in my cart cost around $400 and had tax of $32+ listed...

Attachment 340480

Without knowing for sure, I would hypothesize that eBay is now adding sales tax for specific states when out-of-state purchases are being shipped to that state (i.e. Use Tax), but is still leaving it up to sellers who reside in those states to collect and remit Sales Tax to their state as before. This would make it appear hit-and-miss for application of sales tax for in-state buyers. Did the Wayfair court ruling that all of this was based on even speak to application of in-state sales tax for internet purchases?

I haven't tested this theory. Just throwing it out there for consideration.

This time it's not eBay's fault, though it could have been handled better
 

The Supreme Court case wouldn't directly go into that as they were looking primarily at the issue of what gives state #1 the right to make someone in another state, state #2, have to collect and remit sales tax on sales to customers in state #1. The U.S. Supreme Court gets involved in multi-state issues or those that specifically deal with federal law. A specific state sales tax rule about in-state sellers and how they charge and collect such sales tax from in-state buyers wouldn't necessarily have any federal implications that would require or even permit U.S. Supreme Court involvement. That South Dakota vs. Wayfair case was all about what causes a seller that does not otherwise have any physical presence in a particular state to now have enough presence so they are required to comply with that state's rules as far as charging and remitting sales tax on sales to customers in that state is concerned.

While all this current concern and discussion regarding Ebay now collecting sales tax in certain states is most assuredly a result from last year's South Dakota vs. Wayfair case that went before the U.S. Supreme Court, there's one thing that no one has really addressed about this entire issue that has me scratching my head. That case was all about what makes a seller from one state suddenly subject to sales tax laws of another state, which is what the Supreme Court primarily addressed. Now I admit i have not actually read the complete findings and opinions from the court on this case, but what I didn't hear or see anywhere was if the Supreme Court also offered any ruling or opinion on what constituted a "seller" subject to their findings.

This is where I'm wondering a little bit why Ebay itself is stepping up and taking control and responsibility for collecting and remitting sales tax in certain inter-state sales situations. I always was under the impression that Ebay operated as a platform to provide a virtual marketplace for buyers and sellers to get together and complete transaction online. But Ebay itself doesn't actually own or sell anything and each of the individual account holders that use Ebay are considered as independent entities/sellers. That is markedly different than how other online retailers like Amazon, Wayfair and Rock Auto operate to my knowledge. In those cases, the big online retailers are the sellers, and they should be the ones responsible for charging, collecting and remitting sales tax. In Ebay's case though, I'm actually surprised they are stepping in on behalf of all these independent sellers and starting to collect and remit sales taxes for certain states. I had not heard anywhere that what Ebay does suddenly elevated them to the position of responsibility and liability in regards to state sales taxes. And the fact that certain sellers who were already charging and remitting sales taxes before this recent Supreme Court case are still doing so independently of Ebay seems to go along with that thinking as well. If nothing else, this can become real convoluted for the parties involved. For example, if there was a seller on Ebay who was previously charging sales tax in one of these states Ebay is now handling, what does that seller now do to report those sales if Ebay took over the collection and remittance of sales tax? Especially if that seller also has sales tax obligations to that same state from other venues and platforms they also use to sell to customers in such states?

And I would have thought that Ebay would fight being given such a sales tax responsibility tooth and nail before taking it on like they apparently have. I have seen and heard nothing as to why this is suddenly Ebay's responsibility. Unless Ebay is taking a proactive position that these recent sales tax changes for online retailers is just the beginning and they figure these states will eventually start coming after them as the responsible party so they simply decided to get out in front of it, otherwise I don't get it. For these states to go after each individual seller on Ebay is going to be difficult, time-consuming and not very effective in my opinion. To only have to go after Ebay itself, they can focus on just one huge entity and get the most cost-effective results possible. But then the states would have to be able to prove that Ebay is the seller with the ultimate sales tax responsibility to begin with, which I'm not so sure they really are.

Now I could also then see a particular state going to Ebay and demanding sales information on all their retail activities in that particular state so they can start going after the individual sellers themselves. Ebay should have all the buyer and seller information and activity in their system so it isn't like they could just say no, they didn't have it. Maybe this was something else Ebay saw would be coming and decided that rather than providing such information and pissing off and alienating their sellers, it would be less of an issue with sellers if Ebay just took this on themselves. I'm guessing on this, but it could be a valid explanation as to why they are now doing what they are doing in these certain states in taking on the sales tax collection and remittance functions and responsibilities. It could even be construed as a selling point for Ebay I guess in that they could let people selling on their platform know that by doing so, they don't have to worry about sales tax and all the issues involved. I am fairly certain that Ebay has tons of sellers that are relatively small and as such, don't bother reporting their Ebay sales activity for income or any other tax purposes. By suddenly having state sales tax agents looking at these individual sellers, such information can then get shared between federal, state and local taxing authorities as well. And in this digital age, don't think they don't share information, and plan to do even more of it in the future.

Several years back when Ebay split with Paypal and stopped directly owning them, I actually thought that was a smart, preemptive move on Ebay's part in regards to sales tax issues as it would make it less likely that someone down the road could have argued and said Ebay should be deemed responsible for things like collecting sales tax on transactions through their venue because even if they don't actually own and control the inventory and items being sold, they do control the collection and remittance of the monies from all the activity due to their ownership of Paypal. So if anyone has any factual information as to why Ebay would so quickly and willingly jump in to take on sales tax collection and remittance responsibilities, I'd like to hear and/or see it.

I haven't read every post on this thread so my apologies if already covered but -

Is ebay letting these sellers opt in to the sales tax collecting (by ebay) or is ebay just applying it to all of them in these particular states? It sounds like not all sellers from these states are having the tax collected by ebay so this could explain why.

Rob M

Nope... it is the latter. Ebay is automatically applying the sales tax to all transactions in the states listed earlier in this thread. WA and MN for now, and various others to follow shortly.

Can anyone from Iowa confirm if ebay is now adding sales tax to their out of state ebay purchases?

I had a recent buyer from IA that appears to have had a 6% sales tax added to their order. Ebay appears to now be collecting and remitting sales tax the same way as they do with orders from WA state. On my end, nothing shows in PP, however, when viewing my ebay orders on the ebay Manage Orders screen, the "total" sale amount is 6% more than what shows up on the order in PP.

I think eventually taxes will be all of the states. The tax issue is one of many to be the downfall of brick and mortar retail, imo.

Yes ebay is now withholding for IA, MN, WA and it appears that tax is imposed on shipping and handling as well.

As Leon stated, soon it will be all states.

I had an order two days ago to MN and there appears to be no sales tax yet on that order. This MN order did not show any extra funds collected as the IA and WA state orders do.


Oregon does not charge sales tax....PWCC's vault service may become a work around for paying sales tax on higher dollar items for those buyers located in the growing number of states collecting sales tax on ebay purchases.

I have a New Jersey State resale Certificate. Does that exempt me from paying sales tax on all ebay purchases (even out of state)? Thank you. Joe

Yes, but you need to submit your reseller info to ebay. Details are here: Link. (I have not tried this.)

Yup.... Etsy is now doing the same (in WA anyway). Not sure about other states, but pretty sure that many others will follow.

It depends! If you buy something on Ebay that is actually going to be re-sold by you/your business then, YES, that purchase is generally sales tax exempt to you/your business. But if you buy something that is for you personally and/or used in your business and not necessarily going to be re-sold by you/your business then, NO, that purchase would generally not be sales tax exempt to you/your business.

Just having a resale certificate doesn't automatically exempt you from sales tax on all purchases. And as mentioned by an earlier poster, you would also have to prepare and supply to Ebay, or whomever would otherwise be charging and collecting sales tax from you, a signed copy of any sales tax exemption certificate or form you have that is applicable.

And here's where it can start to get sticky. What if over time you/your business make some Ebay purchases that are sales tax exempt and some that are not. I'm not exactly sure how Ebay will be able to discern between which purchases are or aren't subject to sales tax then. And if a state ever goes back to Ebay to review and audit the sales taxes they are and are not collecting, Ebay will likely turn over their file of any and all sales tax exemption forms they've received for people/businesses. And that helps to show Ebay has no liability for having not collected sales tax from those people/businesses that gave them sales tax exemption certificates. But it also then gives the state a listing of people/businesses to possibly further investigate to see if they are truly sales tax exempt or merely trying to get out of paying sales tax.

Thanks guys for the replies

You're right that I don't see a way for a buyer to convey to eBay which purchases fall into which category. In these cases, one would presumably still have to remit the applicable tax to their state as before. Or would have to establish a separate eBay account for such non-for-resale purchases (probably not a bad idea anyway). This would still be preferable to the previous situation though of eBay not having any way for resellers to avoid eating the sales tax on ALL purchases, regardless of whether intended for resale or personal use.

And that is only the tip of the iceberg. It can get way more complicated and worse than that. Each state with sales taxes has their own unique set of rules of what is and isn't taxable and so on. Not sure how good of a job Ebay is going to do in implementing and then keeping track of the specific rules for each and every state, and then also keep track and make updates as those laws may change. For example, I seem to remember someone saying that in Minnesota they don't charge sales tax on clothing. So what do you do when someone lists say an autographed baseball jersey for sale on Ebay to a buyer in Minnesota? Technically since the jersey can be considered as a wearable piece of clothing, I would guess it should be exempt from Minnesota sales tax, right? But if it is listed in the sports or autographed memorabilia section of Ebay, where it rightly should be, will Ebay be able to detect and properly not charge a resident of Minnesota sales tax on it if they did buy it? See how easily and quickly this can get complicated and difficult to keep track of. And if Ebay is going to assume and take on the responsibility for the collection of these state sales taxes, that is also going to open them up for these states to come in and audit there sales tax collection and remittance activities. And with the sheer size and volume of sales activity on Ebay and potential amounts of sales tax to be collected, it is truly a question of when they will start to get audited by various states, not if.

I don't buy much on Ebay anymore, but I submitted for it, and it went through pretty quickly. It says 7-10 days but it was more like 1 or 2. I made the mistake of first sending them my Sales & Use tax permit, but what they needed was the Sales & Use Tax Resale Certificate exemption form that is filled out for each individual seller you are doing business with (in this case "Ebay").

Supposedly once you submit this, it should be good for 3 years before they request it again.

Another thing they'll have to track, here in Mass, the exemption forms should be filed each year. (Which doesn't always happen in practice)

Anyway to avoid sales tax from ebay?
I guess i'll stop buying from ebay and just go with fb/net54 from now on