Any update on this? I live in a state where Coins and Bullion are still exempt (Connecticut), now ebay is charging sales tax on a coin purchase. I don't mind paying tax where it applies, but it is infuriating to pay tax when is does NOT apply.
Ok, here is the scoop for CT - ebay started charging CT sales tax on April 1. For coins it shows up in the cart as "estimated tax" however, on checkout, the tax is gone, so it appears they are applying the exemption to coins! All right!
Every coin collector and bullion stacker should do this:
Form a company called "[your name] Enterprises" or whatever. You can easily set it up as a "sole proprietorship". Your state's web site will usually have the info and forms to do this easily.
Apply for a sales tax license. With such a license, you can usually be exempt from paying sales tax on items that you buy for resale. Every coin and bullion that you buy for your collection or stack can be considered as purchased for resale at a later date (there is typically no time restriction). Note, however, that if you do this you are supposed to charge and remit sales tax when you sell (unless you are selling an exempt item or selling to a dealer that also has a sales tax license). If your total sales are relatively modest, in most states you can file your sales tax return once per quarter rather than once per month.
Also keep track of every related expense. For income tax purposes all costs associated with the purchase of an item contribute to the "cost basis" of it. As a simple example, suppose you drive 50 miles to a coin show and buy one coin for $100. Your cost basis for the coin is the $100 you paid for it, plus the amount it cost you to drive (round trip). For driving, this is typically 58 cents per mile, or $58 for the trip. So your cost basis for the coin is actually $158, not $100. If later on you sell the coin for $175, your reportable net income is $17, not $75. Other things that can apply to the cost basis: grading fees, hotels (if you stay overnight at a coin show), and commissions that you pay on sales (such as eBay and PayPal fees).
In other words, every coin "collector" should also be a coin "dealer" (even if they don't sell very much at present).
@dcarr said:
Every coin collector and bullion stacker should do this:
Form a company called "[your name] Enterprises" or whatever. You can easily set it up as a "sole proprietorship". Your state's web site will usually have the info and forms to do this easily.
Apply for a sales tax license. With such a license, you can usually be exempt from paying sales tax on items that you buy for resale. Every coin and bullion that you buy for your collection or stack can be considered as purchased for resale at a later date (there is typically no time restriction). Note, however, that if you do this you are supposed to charge and remit sales tax when you sell (unless you are selling an exempt item or selling to a dealer that also has a sales tax license). If your total sales are relatively modest, in most states you can file your sales tax return once per quarter rather than once per month.
Also keep track of every related expense. For income tax purposes all costs associated with the purchase of an item contribute to the "cost basis" of it. As a simple example, suppose you drive 50 miles to a coin show and buy one coin for $100. Your cost basis for the coin is the $100 you paid for it, plus the amount it cost you to drive (round trip). For driving, this is typically 58 cents per mile, or $58 for the trip. So your cost basis for the coin is actually $158, not $100. If later on you sell the coin for $175, your reportable net income is $17, not $75. Other things that can apply to the cost basis: grading fees, hotels (if you stay overnight at a coin show), and commissions that you pay on sales (such as eBay and PayPal fees).
In other words, every coin "collector" should also be a coin "dealer" (even if they don't sell very much at present).
Please consult with your accountant or tax attorney. At one time, the IRS was cracking down on "hobbyists" pretending to run a business. Otherwise, this is a solid suggestion.
Of course, if they become "dealers", they'll all have to hate themselves.
@dcarr said:
Every coin collector and bullion stacker should do this:
Form a company called "[your name] Enterprises" or whatever. You can easily set it up as a "sole proprietorship". Your state's web site will usually have the info and forms to do this easily.
Apply for a sales tax license. With such a license, you can usually be exempt from paying sales tax on items that you buy for resale. Every coin and bullion that you buy for your collection or stack can be considered as purchased for resale at a later date (there is typically no time restriction). Note, however, that if you do this you are supposed to charge and remit sales tax when you sell (unless you are selling an exempt item or selling to a dealer that also has a sales tax license). If your total sales are relatively modest, in most states you can file your sales tax return once per quarter rather than once per month.
Also keep track of every related expense. For income tax purposes all costs associated with the purchase of an item contribute to the "cost basis" of it. As a simple example, suppose you drive 50 miles to a coin show and buy one coin for $100. Your cost basis for the coin is the $100 you paid for it, plus the amount it cost you to drive (round trip). For driving, this is typically 58 cents per mile, or $58 for the trip. So your cost basis for the coin is actually $158, not $100. If later on you sell the coin for $175, your reportable net income is $17, not $75. Other things that can apply to the cost basis: grading fees, hotels (if you stay overnight at a coin show), and commissions that you pay on sales (such as eBay and PayPal fees).
In other words, every coin "collector" should also be a coin "dealer" (even if they don't sell very much at present).
Please consult with your accountant or tax attorney. At one time, the IRS was cracking down on "hobbyists" pretending to run a business. Otherwise, this is a solid suggestion.
Of course, if they become "dealers", they'll all have to hate themselves.
Save your receipt for tax filing. The issue with Sales tax is very costly to many businesses and from what I know If a business builds a tax table they can opt out of the eBay auto tax. It’s all up to setting up the listing. This year 6 states are rolling out. 10 states have exemptions defined about 12 are straight on everything the remaining exempt bullion, .999 content and most FV. What a mess
BTW just because EBay is filing and sent sales tax it certainly does not clear you if it’s done wrong.
@jmlanzaf said:
At one time, the IRS was cracking down on "hobbyists" pretending to run a business.
Yes, but only for those "businesses" which chronically ran at a loss.
If your hobby-business makes a profit or does not lose money for several years in a row, then there is no problem.
@jmlanzaf said:
At one time, the IRS was cracking down on "hobbyists" pretending to run a business.
Yes, but only for those "businesses" which chronically ran at a loss.
If your hobby-business makes a profit or does not lose money for several years in a row, then there is no problem.
Possibly. I would be concerned that a true collector who is accumulating inventory with no sales will raise red flags with either the State sales tax people or the Feds. You will have to file a schedule C which will show tens or hundreds of thousands in inventory but no significant sales. This creates a problem, maybe a couple.
It will be clear to anyone who looks that you are a hobby not a business. Even if the IRS doesn't care, since they haven't lost revenue yet, the State will care as they are giving you a sales tax break. They could see this as criminal, if they are so inclined. So it is worth consulting an accountant or tax attorney.
When you do eventually sell your collection, even pieces of your collection, you will be on the hook for the self-employment tax in addition to any income tax on profits. This could be costly as you will be paying 15% in addition to whatever tax bracket you are in.
Now 15% of the profit is lower than say 7% sales tax on the principle for small appreciations. But if your collection doubles in value over 25 years, you'll end up paying more later.
You will also need to start charging sales tax, where appropriate, on eBay transactions and even possibly BST transactions.
@amwldcoin said:
Click on Manage store then click on subscriber discounts. That's where you should find it.
@derryb said:
so, how do you find the coupon for shipping material? I'm opted out of the global shipping program (and will remain so), does that make a difference?
Thank you for this information.
I thought they had discontinued thus program.
@OPA said:
Some of the big bullion dealers started in November charging sales tax for those states that have one on bullion or coins, if you happen to live in that state (Thank you Supreme Court ---NOT)
Clarification. The bullion dealers don't charge sales tax. They collect it because they are essentially forced to.
And when they collect it when the buyer's state exempts the item from sales tax who is then charging the sales tax?
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
@OPA said:
Some of the big bullion dealers started in November charging sales tax for those states that have one on bullion or coins, if you happen to live in that state (Thank you Supreme Court ---NOT)
Clarification. The bullion dealers don't charge sales tax. They collect it because they are essentially forced to.
And when they collect it when the buyer's state exempts the item from sales tax who is then charging the sales tax?
They do not, can not do that. If they are mistakenly doing it, they will stop if it is pointed out to them as it is illegal to collect sales tax not due.
So, it is completely inaccurate to suggest that anyone but a State taxing entity is charging sales tax.
There was an implementation issue at eBay at first, but they now seem to be current on exemptions.
So, it is completely inaccurate to suggest that anyone but a State taxing entity is charging sales tax.
Semantics. States levy sales taxes, merchants charge and collect them behalf of the state. Sales taxes are levied on an item before its sale. The taxes are charged and collected on behalf of the taxing authority at the time of the sale.
When APMEX tacks on a sales tax to my purchase, they charged me a sale tax because my state required them to. If my state exempts the item then the state does not require APMEX to charge or collect a sales tax.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
So, it is completely inaccurate to suggest that anyone but a State taxing entity is charging sales tax.
Semantics. States levy sales taxes, merchants charge and collect them behalf of the state. Sales taxes are levied on an item before its sale. The taxes are charged and collected on behalf of the taxing authority at the time of the sale.
When APMEX tacks on a sales tax to my purchase, they charged me a sale tax because my state required them to. If my state exempts the item then the state does not require APMEX to charge or collect a sales tax.
Yes, and to your earlier point, APMEX can NOT charge sales tax if the state exempts the item.
As others have said, you are asking for a world of tax trouble if you file for the sales tax exemption certification and then don’t actually run a business. Buying something & salting it away for anticipated sale “at some future date” just won’t do. That is investing, not the conduct of business. Having filed for the exemption, your business tax return will be expected and, if not forthcoming, you will hear from them. You have avoided paying sales taxes under false pretenses.
@OPA said:
Some of the big bullion dealers started in November charging sales tax for those states that have one on bullion or coins, if you happen to live in that state (Thank you Supreme Court ---NOT)
Clarification. The bullion dealers don't charge sales tax. They collect it because they are essentially forced to.
And when they collect it when the buyer's state exempts the item from sales tax who is then charging the sales tax?
Semantics shemantics. Only a taxing authority can charge sales tax. The rubes collect it whether rightly or wrongly. If APMEX collects the tax wrongly, it's on eBay since they assumed responsibility for collecting it. So if an eBay seller collects taxes when they shouldn't, then you need to jump thru whatever hoops needed to get a refund. If APMEX wrongly collects sales taxes for a direct sale then knowing the rules is on them.
I applied for a resale certificate when I first starting purchasing somewhat expensive comics. I bought some over the years, sold some, collected sales tax within my jurisdiction and filed all forms and remitted the tax. I kept solid records. I reported all sales in a venture which lasted about 10 years. I wound up selling all my comics over time and moved on.
@jkrk said:
I applied for a resale certificate when I first starting purchasing somewhat expensive comics. I bought some over the years, sold some, collected sales tax within my jurisdiction and filed all forms and remitted the tax. I kept solid records. I reported all sales in a venture which lasted about 10 years. I wound up selling all my comics over time and moved on.
What else was I supposed to do?
I'm not sure what your question means. If you are buying and selling, you are running a business. If you are buying and collecting, you have a hobby. If you are buying and selling 1% of what you buy, you still have a hobby.
It's really quite simple. States levy taxes. States require retailers to charge them to and collect them from the customer on behalf of the state. If the state was charging you the sales tax you would pay it directly to the state. The middle man does it for both you and the state.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
@ms71 said:
As others have said, you are asking for a world of tax trouble if you file for the sales tax exemption certification and then don’t actually run a business. Buying something & salting it away for anticipated sale “at some future date” just won’t do. That is investing, not the conduct of business. Having filed for the exemption, your business tax return will be expected and, if not forthcoming, you will hear from them. You have avoided paying sales taxes under false pretenses.
I disagree because what I am advocating is that every collector should run their coin affairs like a business, even if it is not a particularly active business. Note, however, that I am not advocating a "sales tax exemption" but rather a "sales tax license". That allows you to avoid paying sales tax on your inventory when you purchase it, but it also requires you to collect sales tax on it when you sell (unless selling to another licensed person or to an exempt location). There is no stipulation as to how long an item can be held in inventory. If an item is purchased with the intent of "investing" in it so as to sell later at a profit, that is acceptable. If, however, an item is purchased for your own use and not for resale, then you are required to report it and pay the sales tax on it if you haven't already.
I have held a sales tax license for at least 25 years now - much longer than I have operated as a mint. I was always honest in keeping records and filing my returns. Before starting my mint, I had numerous returns with no sales and no tax collected. I never had a problem. But I never claimed a reduction in my income tax due to any loss related to my coin collecting/business.
PS:
If, for example, a person can buy a silver futures contract on COMEX and then take delivery of the physical silver without having to pay any sales tax on it, then it is only fair that there be a way for a person to buy silver bullion locally without having to pay sales tax.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
That's a Utah problem not an eBay problem.
IF Utah has a coin exemption, eBay processes it when checkout goes through. If they don't, they have no choice.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
That's a Utah problem not an eBay problem.
IF Utah has a coin exemption, eBay processes it when checkout goes through. If they don't, they have no choice.
At this point, it's becoming a real eBay problem. I had two purchases (me being the seller) from WA buyers where eBay showed sales tax being applied. I don't have a way on my end to see if it was actually paid/showed up on the buyer's side, but it's been turned on and off many times as of late, even though coins and bullion are exempted. eBay is really, really blowing it right now.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
ebay is not currently automatically adding sales tax to UT purchases. If tax is being charged it is by the seller. Link to the listing would assist.
Ebay's current "default" list for charging state sales tax. Screenshot taken from my listing where I charge no sales tax to any state):
Occasionally during the listing process ebay will not let a seller proceed without the seller assigning at least one state sales tax. In these cases, so that I can continue with the listing, I always choose Guam and 1% since I do not ship to Guam. Screenshot taken from such a listing where I specified Guam only:
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
I form new sales tax entities periodically when I am doing something that might generate income or significant expenses, plus a new email. For example, I bought a house to flip, got a sale tax license and a new email. Although I eventually remitted the sales tax, the license also got me a wholesale rate so I saved money there, The email kept all the receipts, for example, Home Depot, Lowe's, etc. in one place, reports, etc. I put all the expenses on a dedicated charge card in the "company" name. When I was done, it was easy to file the Federal and state information, and then I closed it down.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
ebay is not currently automatically adding sales tax to UT purchases. If tax is being charged it is by the seller. Link to the listing would assist.
Ebay's current "default" list for charging state sales tax. Screenshot taken from my listing where I charge no sales tax to any state):
Occasionally during the listing process ebay will not let a seller proceed without the seller assigning at least one state sales tax. In these cases, so that I can continue with the listing, I always choose Guam and 1% since I do not ship to Guam. Screenshot taken from such a listing where I specified Guam only:
No sales tax on coins in Iowa. I have been taxed on non-coin items. Have yet to buy a coin via eBay so far in 2019.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
That's a Utah problem not an eBay problem.
IF Utah has a coin exemption, eBay processes it when checkout goes through. If they don't, they have no choice.
It is a vendor problem, not a Utah problem. There is either a sales tax or there is not. If not, it is up to the vendor platform to have software that filters whether to add sales tax or not.
EBay assisting sellers in complying with the various state laws is a good thing overall, provided they actually get it right.
However, I hope eBay makes it clear and shows the seller's exactly what their buyers are paying, even if those buyers are not paying the seller the funds directly. As a seller, I should know exactly what it cost my customer to buy my coins.
With the global shipping program, where I as a seller cannot see how much the foreign buyers are getting charged for shipping. That doesn't work too well when those same buyers later complain about that price of shipping. Not that I can do much about it, but at least I should know how much we're talking about since it is my name on the business.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
That's a Utah problem not an eBay problem.
IF Utah has a coin exemption, eBay processes it when checkout goes through. If they don't, they have no choice.
It is a vendor problem, not a Utah problem. There is either a sales tax or there is not. If not, it is up to the vendor platform to have software that filters whether to add sales tax or not.
Yes, that is potentially a vendor problem if eBay is not currently collecting tax for the state of Utah. What it is not is an eBay problem which is how it sounded.
I was responding mostly to your "not going to pay sales tax for coins...EVER". If you live in Utah and Utah taxes coin sales, you don't have many options other than the "garage sale exemption"
@illini420 said:
EBay assisting sellers in complying with the various state laws is a good thing overall, provided they actually get it right.
However, I hope eBay makes it clear and shows the seller's exactly what their buyers are paying, even if those buyers are not paying the seller the funds directly. As a seller, I should know exactly what it cost my customer to buy my coins.
With the global shipping program, where I as a seller cannot see how much the foreign buyers are getting charged for shipping. That doesn't work too well when those same buyers later complain about that price of shipping. Not that I can do much about it, but at least I should know how much we're talking about since it is my name on the business.
@illini420 said:
EBay assisting sellers in complying with the various state laws is a good thing overall, provided they actually get it right.
However, I hope eBay makes it clear and shows the seller's exactly what their buyers are paying, even if those buyers are not paying the seller the funds directly. As a seller, I should know exactly what it cost my customer to buy my coins.
With the global shipping program, where I as a seller cannot see how much the foreign buyers are getting charged for shipping. That doesn't work too well when those same buyers later complain about that price of shipping. Not that I can do much about it, but at least I should know how much we're talking about since it is my name on the business.
It is quite clear on the invoice.
clear to the buyer. Illini420's excellent point is that sellers should also be able to see the itemized breakdown that includes a tax being added by ebay and not by the seller.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
ork too well when those same buyers later complain about that price of shipping. Not that I can do much about it, but at least I should know how much we're talking about since it is my name on the business.
It is quite clear on the invoice.
clear to the buyer. Illini420's excellent point is that sellers should also be able to see the itemized breakdown that includes a tax being added by ebay and not by the seller.
You can. I see it whenever eBay collects sales tax on my behalf.
Another cash cow!! Nickel and dime the tax payer to death! 😱Thanks for the info. Just started selling again and will watch the outcome. Btw. How are you doing Jeremy, it's been a long time since I last spoke to you here. Hope your flights in the sky's have been relaxing and calm for the past few years. Smooth fights ahead my friend..😊 I never forget ppl that have touch my inner soul as you did. Thanks for your continued support on Cancer research. It hit me and my family hard. Sorry for the rant.
@dcarr said:
Every coin collector and bullion stacker should do this:
it's been quoted three or four times already
In Texas, failure to file a sales tax return on time incurs a large penalty, even if it's a $0 filing.
After several quarters of $0 filings (I don't remember the number) they will helpfully "offer" to close the account you no longer need.
Most states probably have similar administrative rules.
Strongly recommend you research them before going down this path.
Also remember, no merchant HAS TO accept a reseller's certificate. And you can't use it to buy merch that is not for resale... I could buy computer parts for resale, but not for my personal use and not other things...
-----Burton ANA 50 year/Life Member (now "Emeritus")
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
ebay is not currently automatically adding sales tax to UT purchases. If tax is being charged it is by the seller. Link to the listing would assist.
Ebay's current "default" list for charging state sales tax. Screenshot taken from my listing where I charge no sales tax to any state):
Occasionally during the listing process ebay will not let a seller proceed without the seller assigning at least one state sales tax. In these cases, so that I can continue with the listing, I always choose Guam and 1% since I do not ship to Guam. Screenshot taken from such a listing where I specified Guam only:
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
The dollar volume or number of transactions applies to EBAY not the individual seller. The states have conveniently guaranteed that they maximize their revenue. If you sell through your own website or on BST, you can skate under the numbers. If you sell on eBay, even a single 99 cent sale is taxable.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
The dollar volume or number of transactions applies to EBAY not the individual seller. The states have conveniently guaranteed that they maximize their revenue. If you sell through your own website or on BST, you can skate under the numbers. If you sell on eBay, even a single 99 cent sale is taxable.
ebay is not currently automatically adding sales tax to UT purchases. If tax is being charged it is by the seller. Link to the listing would assist.
I went to Heritage and their state by state tax list also show Utah sales tax exempt from Numismatic coin auction sales.
Screen snip - Address redacted, but it did show my Utah address as the buyer.
Did you get charged the sales tax when the payment processed? There was a short time where the checkout would have a sales tax amount, but it was taken off when I made payment (which is appropriate for Connecticut)
I was responding mostly to your "not going to pay sales tax for coins...EVER". If you live in Utah and Utah taxes coin sales, you don't have many options other than the "garage sale exemption"
No sales tax on coins in Utah. Utah was the first state to recognize mint issued gold and silver bullion as legal tender. We live free here. well, sorta free, semi-free...a little bit free.
Connecticut Coin - Never pulled the trigger. Probably better, it would have been an impulse buy.
ebay is not currently automatically adding sales tax to UT purchases. If tax is being charged it is by the seller. Link to the listing would assist.
I went to Heritage and their state by state tax list also show Utah sales tax exempt from Numismatic coin auction sales.
Screen snip - Address redacted, but it did show my Utah address as the buyer.
Did you get charged the sales tax when the payment processed? There was a short time where the checkout would have a sales tax amount, but it was taken off when I made payment (which is appropriate for Connecticut)
In Texas I file once a year. Coins and Bullion no sales tax due on these. Shows I setup here require a sales tax ID number no problem for me. Due do the expense of travel costs and travel risks I do online and nearby shows. Traveling with coins is risky, a gold specialist told me traveling with briefcase of $500 k gold coins (his livelihood) very stressful. In that scenario when in route do not let it leave your sight or talk about coins. Robbers would attack you for far less. Packing heat helps but you can’t do that in airports. Once u add travel and hotel cost to the table fee you can have quite a fixed cost hole get out of.
Show Security Overview:
1. Material at risk from departure until safely at destination (bourse room - shows).
2. I dont allow material leave my table unless paid for. Period - no exceptions.
3. In leaving I want take everything to car in one trip.
4. Enroute home take care in obeying traffic laws plus make certain not being followed. No leaving material in car to stop / eat. Drivethru ok if certain not being followed.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
The dollar volume or number of transactions applies to EBAY not the individual seller. The states have conveniently guaranteed that they maximize their revenue. If you sell through your own website or on BST, you can skate under the numbers. If you sell on eBay, even a single 99 cent sale is taxable.
Not sure if I agree with you. If the above is the case, I would have been charged sales tax for items that I purchased from small time sellers. I live in MD. On the other hand, most of the "big time" sellers are now charging me a sales tax.....not all, however (most likely they did not meet the threshold in 2018)
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
The dollar volume or number of transactions applies to EBAY not the individual seller. The states have conveniently guaranteed that they maximize their revenue. If you sell through your own website or on BST, you can skate under the numbers. If you sell on eBay, even a single 99 cent sale is taxable.
Not sure if I agree with you. If the above is the case, I would have been charged sales tax for items that I purchased from small time sellers. I live in MD. On the other hand, most of the "big time" sellers are now charging me a sales tax.....not all, however (most likely they did not meet the threshold in 2018)
Some of the bigger dealers have already started charging tax to more states than ebay is requiring. All sellers will be forced to do it eventually.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
The dollar volume or number of transactions applies to EBAY not the individual seller. The states have conveniently guaranteed that they maximize their revenue. If you sell through your own website or on BST, you can skate under the numbers. If you sell on eBay, even a single 99 cent sale is taxable.
Not sure if I agree with you. If the above is the case, I would have been charged sales tax for items that I purchased from small time sellers. I live in MD. On the other hand, most of the "big time" sellers are now charging me a sales tax.....not all, however (most likely they did not meet the threshold in 2018)
You can't really disagree with a fact. Ebay collects not the individual. It's not even an option the seller can control.
At one time, these were called Amazon laws because they were designed to keep Amazon sellers from ducking sales tax.
The reason you aren't charged is because Maryland hasn't passed such a law yet. They aren't one of the 12 states.
I sent out a coin today and the buyer paid $100 in taxes. The invoice I printed did not have it listed at all, I reprinted another writing amount eBay collected in taxes.
What states are killing coin collectors in their state?
Still no taxes on coins and bullion in the commonwealth, god bless the commonwealth!
Now those Ba$&^@?! did start taxing jewelry so the Apmex 1oz AGE with bezel they list in jewelry category is now out of the question on bonus ebux days.
Comments
Any update on this? I live in a state where Coins and Bullion are still exempt (Connecticut), now ebay is charging sales tax on a coin purchase. I don't mind paying tax where it applies, but it is infuriating to pay tax when is does NOT apply.
Ok, here is the scoop for CT - ebay started charging CT sales tax on April 1. For coins it shows up in the cart as "estimated tax" however, on checkout, the tax is gone, so it appears they are applying the exemption to coins! All right!
Every coin collector and bullion stacker should do this:
Form a company called "[your name] Enterprises" or whatever. You can easily set it up as a "sole proprietorship". Your state's web site will usually have the info and forms to do this easily.
Apply for a sales tax license. With such a license, you can usually be exempt from paying sales tax on items that you buy for resale. Every coin and bullion that you buy for your collection or stack can be considered as purchased for resale at a later date (there is typically no time restriction). Note, however, that if you do this you are supposed to charge and remit sales tax when you sell (unless you are selling an exempt item or selling to a dealer that also has a sales tax license). If your total sales are relatively modest, in most states you can file your sales tax return once per quarter rather than once per month.
Also keep track of every related expense. For income tax purposes all costs associated with the purchase of an item contribute to the "cost basis" of it. As a simple example, suppose you drive 50 miles to a coin show and buy one coin for $100. Your cost basis for the coin is the $100 you paid for it, plus the amount it cost you to drive (round trip). For driving, this is typically 58 cents per mile, or $58 for the trip. So your cost basis for the coin is actually $158, not $100. If later on you sell the coin for $175, your reportable net income is $17, not $75. Other things that can apply to the cost basis: grading fees, hotels (if you stay overnight at a coin show), and commissions that you pay on sales (such as eBay and PayPal fees).
In other words, every coin "collector" should also be a coin "dealer" (even if they don't sell very much at present).
Please consult with your accountant or tax attorney. At one time, the IRS was cracking down on "hobbyists" pretending to run a business. Otherwise, this is a solid suggestion.
Of course, if they become "dealers", they'll all have to hate themselves.
This! (In bold)
Edit to add: Tax tips. https://www.irs.gov/newsroom/hobby-or-business-irs-offers-tips-to-decide
Save your receipt for tax filing. The issue with Sales tax is very costly to many businesses and from what I know If a business builds a tax table they can opt out of the eBay auto tax. It’s all up to setting up the listing. This year 6 states are rolling out. 10 states have exemptions defined about 12 are straight on everything the remaining exempt bullion, .999 content and most FV. What a mess
BTW just because EBay is filing and sent sales tax it certainly does not clear you if it’s done wrong.
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Yes, but only for those "businesses" which chronically ran at a loss.
If your hobby-business makes a profit or does not lose money for several years in a row, then there is no problem.
Possibly. I would be concerned that a true collector who is accumulating inventory with no sales will raise red flags with either the State sales tax people or the Feds. You will have to file a schedule C which will show tens or hundreds of thousands in inventory but no significant sales. This creates a problem, maybe a couple.
It will be clear to anyone who looks that you are a hobby not a business. Even if the IRS doesn't care, since they haven't lost revenue yet, the State will care as they are giving you a sales tax break. They could see this as criminal, if they are so inclined. So it is worth consulting an accountant or tax attorney.
When you do eventually sell your collection, even pieces of your collection, you will be on the hook for the self-employment tax in addition to any income tax on profits. This could be costly as you will be paying 15% in addition to whatever tax bracket you are in.
Now 15% of the profit is lower than say 7% sales tax on the principle for small appreciations. But if your collection doubles in value over 25 years, you'll end up paying more later.
You will also need to start charging sales tax, where appropriate, on eBay transactions and even possibly BST transactions.
Thank you for this information.
I thought they had discontinued thus program.
And when they collect it when the buyer's state exempts the item from sales tax who is then charging the sales tax?
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
They do not, can not do that. If they are mistakenly doing it, they will stop if it is pointed out to them as it is illegal to collect sales tax not due.
So, it is completely inaccurate to suggest that anyone but a State taxing entity is charging sales tax.
There was an implementation issue at eBay at first, but they now seem to be current on exemptions.
Latest state list impacted by ebay sales tax collection
Was eight states, now ten
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
Semantics. States levy sales taxes, merchants charge and collect them behalf of the state. Sales taxes are levied on an item before its sale. The taxes are charged and collected on behalf of the taxing authority at the time of the sale.
When APMEX tacks on a sales tax to my purchase, they charged me a sale tax because my state required them to. If my state exempts the item then the state does not require APMEX to charge or collect a sales tax.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
Yes, and to your earlier point, APMEX can NOT charge sales tax if the state exempts the item.
As others have said, you are asking for a world of tax trouble if you file for the sales tax exemption certification and then don’t actually run a business. Buying something & salting it away for anticipated sale “at some future date” just won’t do. That is investing, not the conduct of business. Having filed for the exemption, your business tax return will be expected and, if not forthcoming, you will hear from them. You have avoided paying sales taxes under false pretenses.
Coinlearner, Ahrensdad, Nolawyer, RG, coinlieutenant, Yorkshireman, lordmarcovan, Soldi, masscrew, JimTyler, Relaxn, jclovescoins
Now listen boy, I'm tryin' to teach you sumthin' . . . . that ain't an optical illusion, it only looks like an optical illusion.
My mind reader refuses to charge me....
Semantics shemantics. Only a taxing authority can charge sales tax. The rubes collect it whether rightly or wrongly. If APMEX collects the tax wrongly, it's on eBay since they assumed responsibility for collecting it. So if an eBay seller collects taxes when they shouldn't, then you need to jump thru whatever hoops needed to get a refund. If APMEX wrongly collects sales taxes for a direct sale then knowing the rules is on them.
I applied for a resale certificate when I first starting purchasing somewhat expensive comics. I bought some over the years, sold some, collected sales tax within my jurisdiction and filed all forms and remitted the tax. I kept solid records. I reported all sales in a venture which lasted about 10 years. I wound up selling all my comics over time and moved on.
What else was I supposed to do?
I'm not sure what your question means. If you are buying and selling, you are running a business. If you are buying and collecting, you have a hobby. If you are buying and selling 1% of what you buy, you still have a hobby.
It's really quite simple. States levy taxes. States require retailers to charge them to and collect them from the customer on behalf of the state. If the state was charging you the sales tax you would pay it directly to the state. The middle man does it for both you and the state.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
I disagree because what I am advocating is that every collector should run their coin affairs like a business, even if it is not a particularly active business. Note, however, that I am not advocating a "sales tax exemption" but rather a "sales tax license". That allows you to avoid paying sales tax on your inventory when you purchase it, but it also requires you to collect sales tax on it when you sell (unless selling to another licensed person or to an exempt location). There is no stipulation as to how long an item can be held in inventory. If an item is purchased with the intent of "investing" in it so as to sell later at a profit, that is acceptable. If, however, an item is purchased for your own use and not for resale, then you are required to report it and pay the sales tax on it if you haven't already.
I have held a sales tax license for at least 25 years now - much longer than I have operated as a mint. I was always honest in keeping records and filing my returns. Before starting my mint, I had numerous returns with no sales and no tax collected. I never had a problem. But I never claimed a reduction in my income tax due to any loss related to my coin collecting/business.
PS:
If, for example, a person can buy a silver futures contract on COMEX and then take delivery of the physical silver without having to pay any sales tax on it, then it is only fair that there be a way for a person to buy silver bullion locally without having to pay sales tax.
Interesting, I went to BIN on a Barber Half (I live in Utah) and Ebay had calculated sales tax. Sorry not going to pay sales tax for coins...EVER. That was a $575.00 sale that went down the drain.
That's a Utah problem not an eBay problem.
IF Utah has a coin exemption, eBay processes it when checkout goes through. If they don't, they have no choice.
At this point, it's becoming a real eBay problem. I had two purchases (me being the seller) from WA buyers where eBay showed sales tax being applied. I don't have a way on my end to see if it was actually paid/showed up on the buyer's side, but it's been turned on and off many times as of late, even though coins and bullion are exempted. eBay is really, really blowing it right now.
ebay is not currently automatically adding sales tax to UT purchases. If tax is being charged it is by the seller. Link to the listing would assist.
Ebay's current "default" list for charging state sales tax. Screenshot taken from my listing where I charge no sales tax to any state):
Occasionally during the listing process ebay will not let a seller proceed without the seller assigning at least one state sales tax. In these cases, so that I can continue with the listing, I always choose Guam and 1% since I do not ship to Guam. Screenshot taken from such a listing where I specified Guam only:
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
I form new sales tax entities periodically when I am doing something that might generate income or significant expenses, plus a new email. For example, I bought a house to flip, got a sale tax license and a new email. Although I eventually remitted the sales tax, the license also got me a wholesale rate so I saved money there, The email kept all the receipts, for example, Home Depot, Lowe's, etc. in one place, reports, etc. I put all the expenses on a dedicated charge card in the "company" name. When I was done, it was easy to file the Federal and state information, and then I closed it down.
IRS on hobby versus business:
https://www.irs.gov/newsroom/hobby-or-business-irs-offers-tips-to-decide
No sales tax on coins in Iowa. I have been taxed on non-coin items. Have yet to buy a coin via eBay so far in 2019.
I went to Heritage and their state by state tax list also show Utah sales tax exempt from Numismatic coin auction sales.
Screen snip - Address redacted, but it did show my Utah address as the buyer.
It is a vendor problem, not a Utah problem. There is either a sales tax or there is not. If not, it is up to the vendor platform to have software that filters whether to add sales tax or not.
EBay assisting sellers in complying with the various state laws is a good thing overall, provided they actually get it right.
However, I hope eBay makes it clear and shows the seller's exactly what their buyers are paying, even if those buyers are not paying the seller the funds directly. As a seller, I should know exactly what it cost my customer to buy my coins.
With the global shipping program, where I as a seller cannot see how much the foreign buyers are getting charged for shipping. That doesn't work too well when those same buyers later complain about that price of shipping. Not that I can do much about it, but at least I should know how much we're talking about since it is my name on the business.
Michael Kittle Rare Coins --- 1908-S Indian Head Cent Grading Set --- No. 1 1909 Mint Set --- Kittlecoins on Facebook --- Long Beach Table 448
Yes, that is potentially a vendor problem if eBay is not currently collecting tax for the state of Utah. What it is not is an eBay problem which is how it sounded.
I was responding mostly to your "not going to pay sales tax for coins...EVER". If you live in Utah and Utah taxes coin sales, you don't have many options other than the "garage sale exemption"
It is quite clear on the invoice.
clear to the buyer. Illini420's excellent point is that sellers should also be able to see the itemized breakdown that includes a tax being added by ebay and not by the seller.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
ork too well when those same buyers later complain about that price of shipping. Not that I can do much about it, but at least I should know how much we're talking about since it is my name on the business.
You can. I see it whenever eBay collects sales tax on my behalf.
Another cash cow!! Nickel and dime the tax payer to death! 😱Thanks for the info. Just started selling again and will watch the outcome. Btw. How are you doing Jeremy, it's been a long time since I last spoke to you here. Hope your flights in the sky's have been relaxing and calm for the past few years. Smooth fights ahead my friend..😊 I never forget ppl that have touch my inner soul as you did. Thanks for your continued support on Cancer research. It hit me and my family hard. Sorry for the rant.
op says doesn't want to be pollical about taxes...lol
In Texas, failure to file a sales tax return on time incurs a large penalty, even if it's a $0 filing.
After several quarters of $0 filings (I don't remember the number) they will helpfully "offer" to close the account you no longer need.
Most states probably have similar administrative rules.
Strongly recommend you research them before going down this path.
Also remember, no merchant HAS TO accept a reseller's certificate. And you can't use it to buy merch that is not for resale... I could buy computer parts for resale, but not for my personal use and not other things...
ANA 50 year/Life Member (now "Emeritus")
Does eBay collect sales tax to those 3 states from sellers that have 10 feedback since they can't likely meet the dollar volume or number of transactions minimums?
The dollar volume or number of transactions applies to EBAY not the individual seller. The states have conveniently guaranteed that they maximize their revenue. If you sell through your own website or on BST, you can skate under the numbers. If you sell on eBay, even a single 99 cent sale is taxable.
Agree.
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
makes sense ty
Did you get charged the sales tax when the payment processed? There was a short time where the checkout would have a sales tax amount, but it was taken off when I made payment (which is appropriate for Connecticut)
No sales tax on coins in Utah. Utah was the first state to recognize mint issued gold and silver bullion as legal tender. We live free here. well, sorta free, semi-free...a little bit free.
Connecticut Coin - Never pulled the trigger. Probably better, it would have been an impulse buy.
Ebay Marketplace Update
List of affected states growing, now up to 12 states where ebay will charge sales tax
"The good old days when “JUSTICE” stood for something instead of “JUST US.”" - Martin Armstrong
...and no Ebay Bucks on the tax.
I have sales tax number / DBA setup.
In Texas I file once a year. Coins and Bullion no sales tax due on these. Shows I setup here require a sales tax ID number no problem for me. Due do the expense of travel costs and travel risks I do online and nearby shows. Traveling with coins is risky, a gold specialist told me traveling with briefcase of $500 k gold coins (his livelihood) very stressful. In that scenario when in route do not let it leave your sight or talk about coins. Robbers would attack you for far less. Packing heat helps but you can’t do that in airports. Once u add travel and hotel cost to the table fee you can have quite a fixed cost hole get out of.
Show Security Overview:
1. Material at risk from departure until safely at destination (bourse room - shows).
2. I dont allow material leave my table unless paid for. Period - no exceptions.
3. In leaving I want take everything to car in one trip.
4. Enroute home take care in obeying traffic laws plus make certain not being followed. No leaving material in car to stop / eat. Drivethru ok if certain not being followed.
Not sure if I agree with you. If the above is the case, I would have been charged sales tax for items that I purchased from small time sellers. I live in MD. On the other hand, most of the "big time" sellers are now charging me a sales tax.....not all, however (most likely they did not meet the threshold in 2018)
Some of the bigger dealers have already started charging tax to more states than ebay is requiring. All sellers will be forced to do it eventually.
You can't really disagree with a fact. Ebay collects not the individual. It's not even an option the seller can control.
At one time, these were called Amazon laws because they were designed to keep Amazon sellers from ducking sales tax.
The reason you aren't charged is because Maryland hasn't passed such a law yet. They aren't one of the 12 states.
I sent out a coin today and the buyer paid $100 in taxes. The invoice I printed did not have it listed at all, I reprinted another writing amount eBay collected in taxes.
What states are killing coin collectors in their state?
Still no taxes on coins and bullion in the commonwealth, god bless the commonwealth!
Now those Ba$&^@?! did start taxing jewelry so the Apmex 1oz AGE with bezel they list in jewelry category is now out of the question on bonus ebux days.
The whole worlds off its rocker, buy Gold™.