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Topic: OT: Question for developers do you charge Sales Tax?

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  1. #1

    OT: Question for developers do you charge Sales Tax?

    I was looking through google and reading up on sales tax issues, but I've noticed some developers that sell Sample Libraries on CDs/DVDs charge sales tax, but some don't.

    I was wondering if anyone has any defined information on this? When are the sellers required to charge tax and when aren't they?

    Thank you in advance,

  2. #2

    Re: OT: Question for developers do you charge Sales Tax?

    Quote Originally Posted by panzerD
    I was looking through google and reading up on sales tax issues, but I've noticed some developers that sell Sample Libraries on CDs/DVDs charge sales tax, but some don't.

    I was wondering if anyone has any defined information on this? When are the sellers required to charge tax and when aren't they?

    Thank you in advance,
    ALL U.S. developers, NO EXCEPTION, who sell their products must register with their city for a business license and state to get a resellers certificate. ALL developers, NO EXCEPTION, must collect sales tax for their state and report it quarterly/annually depending on their dollar volume.

    If you're in the state of California in the greater Los Angeles area, composers working in film/tv get a sales tax break of 3.25% vs. 8.25%. To get the break, they must file a form with the developer and the developer must report this on his sales tax report, along, if asked for, with a copy of the form filled out by the composer. The California developer cannot give this discount unless the composer has filled out the form. If you're not charged sales tax by a developer in your state, you're legally obligated to report it.

    If a developer operates in the same state in which you live and DOES NOT charge you sales tax (unless you're a state that doesn't charge sales tax), then that developer is committing sales tax evasion which is illegal.
    Peter L. Alexander
    www.professionalorchestration.com
    www.alexanderpublishing.com
    Learn it right the first time.

  3. #3

    Re: OT: Question for developers do you charge Sales Tax?

    We at SampleTekk have chosen to have the same price regardless who buys it and where they live.
    We, however, pay all necessary taxes.
    This applies to products bought from our online store
    Worra
    SampleTekk

    Arf, arf, arf...

  4. #4

    Re: OT: Question for developers do you charge Sales Tax?

    Unless the developer is registered in the state of Delaware
    We are not required to charge/collect a sales tax.

    Home of Tax Free Shopping - Delaware is one of only five states having no sales tax.

  5. #5

    Re: OT: Question for developers do you charge Sales Tax?

    Thank you everyone for the very helpful replies.

  6. #6

    Re: OT: Question for developers do you charge Sales Tax?

    Quote Originally Posted by Worra
    We at SampleTekk have chosen to have the same price regardless who buys it and where they live.
    We, however, pay all necessary taxes.
    This applies to products bought from our online store
    Since you're outside the US, you wouldn't be charging sales tax for any U.S. location.
    Peter L. Alexander
    www.professionalorchestration.com
    www.alexanderpublishing.com
    Learn it right the first time.

  7. #7

    Exclamation Re: OT: Question for developers do you charge Sales Tax?

    Internet Sales, which takes tax-free shopping to a new level. In fact, no-tax shopping has become a prime lure of online retailers looking to hook consumers on click-and-charge buying. Despite what you sometimes hear, however, some Internet sales are subject to sales tax and consumers often have a responsibility to remit any unpaid sales tax on online purchases directly to their state.

    The obligation to pay sales tax is determined by the location of the buyer, not the seller. If a business does not have a physical presence in a particular state, such as Delaware, or store or warehouse, it is not required to collect sales tax for sales from customers in that state. In legal speak, this connection between sales and location is referred to as a "nexus" and was established by the U.S. Supreme Court in Quill v. North Dakota, 504 U.S. 298 (1992).

  8. #8

    Re: OT: Question for developers do you charge Sales Tax?

    Quote Originally Posted by Bela D Media
    Unless the developer is registered in the state of Delaware
    We are not required to charge/collect a sales tax.

    Home of Tax Free Shopping - Delaware is one of only five states having no sales tax.
    I love spending large amounts of money at Delaware outlet stores for that very reason ....
    Tim

  9. #9
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    Re: OT: Question for developers do you charge Sales Tax?

    Quote Originally Posted by Bela D Media
    Internet Sales, which takes tax-free shopping to a new level. In fact, no-tax shopping has become a prime lure of online retailers looking to hook consumers on click-and-charge buying. Despite what you sometimes hear, however, some Internet sales are subject to sales tax and consumers often have a responsibility to remit any unpaid sales tax on online purchases directly to their state.

    The obligation to pay sales tax is determined by the location of the buyer, not the seller. If a business does not have a physical presence in a particular state, such as Delaware, or store or warehouse, it is not required to collect sales tax for sales from customers in that state. In legal speak, this connection between sales and location is referred to as a "nexus" and was established by the U.S. Supreme Court in Quill v. North Dakota, 504 U.S. 298 (1992).
    Good points Francis.

    Internet-based e-commerce has become a lure and it also has leveled the playing field and has made it easier for small independent developers (like us ) to compete successfully with large international concerns. Although technology has provided great opportunities, it has also raised many issues with regards to taxation.

    In the US, it is incumbant on the seller to collect taxes for sales to customers within that state. Generally, a US state’s taxing power extends as far as its borders but some in government are seeking to change this.

    For sales tax purposes a state generally cannot impose sales tax on retail sales for sales in other states. To get around this some states also impose a “use” tax. The use tax applies to the “use, storage, or other consumption” within the state of tangible personal property, the purchase of which would have been subject to the sales tax had the transaction occurred within the state. These "use taxes" are almost universally ignored and unenforced except for large corporations (which are subject to audit) and major purchases like automobiles (where states use a registration process to collect use tax on out-of-state purchases). This may be changing and extending to other sales. Some lawmakers are trying to get companies to collect sales taxes on all goods sold over the internet. This past year, some of the largest retailers, including Walmart, Target and Toys R' Us, under a program called the Streamlined Sales Tax Project (“SSTA”), voluntarily started collecting state sales tax on all goods sold over the Internet.

    Whether the internet will be a tax-free zone or whether the laws will change to mandate sellers collect sales taxes on out of state purchases is beeing debated in various governments. Time will tell the outcome.

    MSN Money just did a report on "The best and worst states for taxes" and lists the various sales taxes by state. Exciting read (not!)

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