Views:255 Author:Site Editor Publish Time: 2020-09-29 Origin:Site
If you’re new to business and you’re selling face masks in your community for the first time, you maybe need to obtain a sales tax permit and start collecting and remitting tax on your sales. Some states allow an exception for casual sales, like a one-time garage sale, but ongoing sales generally require a permit and tax collection. When in doubt, contact the state department of revenue and local government.
Once registered, tax generally applies to sales made anywhere in the state, including phone or online sales.
If you want to expand your market by selling online, maybe collecting sales tax will be triggered in states where you have no physical presence.
Most states now enforce economic nexus, which bases a sales tax collection obligation solely on sales and/or transaction volume in the state. Of the 45 states with a statewide sales tax, only Florida and Missouri have not adopted economic nexus. Even some communities in Alaska enforce economic nexus for local sales tax.
Determining whether economic nexus has been established is tricky because each state’s economic nexus law is unique. For example, economic nexus is established as a result of:
· One sale into Kansas
· More than $500,000 in total combined sales of tangible personal property in California
· More than $300,000 in cumulative total gross sales and more than 100 transactions in New York
Most states have an economic nexus threshold of $100,000 or 200 transactions. In other words, selling one mask to 200 different people in a state could trigger economic nexus, even if each mask sold for only $10.
Learn more about mask production and sales