collecting taxes online

[jennifer]

okay this is for those of you in states like oklahoma, texas, and california where you are supposed to collect taxes online for everyone in your home state based on their tax rate. how do you guys/gals get that accomplished? I'm attempting to get zen cart setup but i'm just not sure what all i need to do to fix my tax dilema. any help is appreciated.

oh and i did try to use their forum, but I don't think anyone who looks at their forum really knows any more than I do

[SSR Candles]

Technically, just about everyone is required to collect takes for ANY sale, online or not, in their own state.

With Zen Cart, you'll need to first create a zone that is for your state only (Do this under the "Zones Definitions" section), then you'll need to specify a tax rate for that zone (under "Tax Rates"). You might also have to create a tax class for taxable goods (under "Tax Classes"), if it isn't already there.

HTH!

[jennifer]

My problem isn't that i know I need to collect taxes its that I need to collect taxes at different rates all over my state.

IE where I live it's 8.75%, in another its 9%, another is 8.35%, and so on

that's what I need help with if anyone knows how. Oklahoma does not allow us to charge a "flat" rate for the entire state, we must also collect the individual city and county rates

Thanks

[Bunny]

So when you pay your taxes, you send a different check to each county?

[Di_in_AZ]

Where I am you collect the taxes where the business transaction takes place, that would be where you are located, you would collect the taxes applicable in your neck of the woods. If you are conducting business in another town, perhaps for a craft show, then you would have to collect taxes on behalf of that town/county. Online the business transaction is where you are so you would collect the rate for your town/county. I cannot see this being different from state to state, that does not make sense. The business transaction is not taking place at the residence of the purchaser--the card is not being processed from their address, it is being processed from yours. If the purchaser is out of state, then you don't tax. This is the law where I am in AZ.

[Bunny]

From what I'm reading on the OK sales tax site, you tax your in state orders at your tax rate. Now, if you hand delivered, those would be taxed at the different county rates. Will keep looking to find something more definitive.

[Vicky_CO]

Here you collect the taxes you have in common with the customer so if I sell to someone in a town 20 miles away and I ship it to them I would collect State and county tax but not city if I sell to some one in the next county I would only collect the state tax. But when I talked to the state sales tax guy about this he told me to collect the whole thing in my cart but make the corrections in the final invoice when I charge the credit card. If it is paypal/check/money order that they are paying by then since I actually recieve the tax moneys then I am to remit what I collect for city and county to the state. They even have a place for that on my return.

[Erin Lea]

When I got my papers from the state (TX), the info. they gave me was this: You need to collect the sales tax rate for your location, not where the customer lives. For example, I'm in Denton, TX and my state + local sales tax rate is 8.25% so I collect 8.25% sales tax on sales from anywhere in TX. HTH.

[jennifer]

Okay, so now I'm really confused because when I went to the small business office they said that I needed to collect each individual towns rates when I sell online. oh and i don't send in a different check to each county, I have a paper that I fill in where I list each individual city and each individual county, calculate everything and send it in to the state and then I presume that they send it out to the correct places.

I'll check some where else and see if they people at the small business place were wrong with what they told me.

Thanks

[clonefan80]

Jennifer, collecting for each county used to be the case however this past year it was changed to point of transaction. I would say that the point of transaction takes place where you live because you are not delivering the goods to them but rather shipping. The Oklahoma Tax Commission has an information line set up for these questions and I think they would be better able to give you a definitive answer rather than the small business office, they are online as well. Bunny's response was correct.

[Di_in_AZ]

Okay, so now I'm really confused because when I went to the small business office they said that I needed to collect each individual towns rates when I sell online. oh and i don't send in a different check to each county, I have a paper that I fill in where I list each individual city and each individual county, calculate everything and send it in to the state and then I presume that they send it out to the correct places.

I'll check some where else and see if they people at the small business place were wrong with what they told me.

Thanks

Contact your state revenue office. They are the ONLY ones who can give you a definitive answer, they are the ones you have to answer to. They are always more than helpful and in AZ they have most questions already answered online.

[ah-soy]

Here are a couple of links that address the issue:

http://www.newrules.org/retail/inttax2.html

http://www.nolo.com/article.cfm/objectID/87F6DD43-E6F2-4DFE-BCDB8E2E85DFF80B/111/277/167/ART/

Don't think this answers your questions, just thought it was interesting reading.

Di, I'm off the check out our AZ rules...I'm hoping to have my site up and running sometime this spring so thanks for the info.

[SoapLady]

I'm not sure, but this link may be helpful to you. In my state, I will be required to collect sales tax for customers in other states and county taxes in my state (based on customer's residence) as of 1/1/08. Collecting and filing all that tax will not be fun. There is a project underway to streamline the process for e-retailers: http://www.streamlinedsalestax.org/

[Hibiscus]

To confuse folks even further, here is what I thought..lol..It was my understanding that you were not supposed to collect taxes from other states unless you have a physical business set up in that state. When I shop online there aren't any taxes added unless that business is located in my state as well...hope that's not too confusing....:undecided

[Kelly]

Hmmm, I wish someone knew the correct answer to this, because to me it doesn't seem fair to charge everyone purchasing online from me Wisconsin (my state) sales tax. Especially if sales tax in thier state is less than the Wisconsin sales tax. Although if I were to drive to another state and buy something I would have to pay their sales tax.

Man, this is too confusing.

[Erin Lea]

I don't know a 100% one-size-fits-all answer, but I've done a ton of internet shopping and I never pay sales tax unless I am a resident of, or am buying something for a resident of (and am having it shipped to them) of the state where that business exists. I really think the same goes for all of us. If we have a business in state A and people from state A, B & C buy something from us then only the person from state A is charged sales tax. That's how my shopping cart is configured and that's how the tax is figured when I submit my sales tax to the state of TX. HTH.

[jennifer]

Absolutely! You only pay taxes if the seller and buyer are in the same state. Unfortunately some states seem to think that we also need to collect county/city tax for anyone in your same state. I haven' had a chance yet to check with the oklahoma tax commission but supposedly they have changed their ways and we do not need to collect the individual county/city taxes in state any longer.

As I understand it however, we are suppose to post something on our sites stating that customers in other states may be subject to use taxes as their states see fit.