Sales Tax On Coins & Bullion...
Coll3ctor
Posts: 3,343 ✭✭✭
I'm from Wisconsin and get charged 5.5% sales tax on in state purchases on coins/bullion. When I drive to Illinois and purchase coins/bullion they do not charge me sales tax.
So why is it that when I purchase coins/bullion on eBay from places in Illinois I gets charged Wisconsin 5.5% rate sales tax?
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Generally speaking it is due to the 2018 Wayfair SCOTUS decision on the concept of economic nexus. Because eBay bears responsibility for over $100k in annual sales into Wisconsin, they have an obligation to collect and remit sales tax in accordance with state and and local requirements.
I run a small business and when I buy items online from the state of Missouri I pay no sales tax.
Is this only an eBay thing?
In the strict sense of the law, after you have purchased something in Illinois and come back to Wisconsin, you are supposed to pay the sales tax to Wisconsin.
I had an argument similar to this with a guy from Connecticut who as at a Massachusetts show. I quoted him on an item with the sales tax. He asked why he had to pay sales tax since he was from Connecticut. "Because this show is in Massachusetts and I have to charge the tax," was my answer. He passed on the deal because of that.
It worked out okay, The item was a Morgan Dollar, and later the Greysheet bid went up on it, and I sold the piece for more.
Sales tax is collected for the buyers address not the sellers address.
If you have a tax ID I think you give them that number. It should work out in public as well I hope I'm right on this. Input is welome
I am NOT an expert on WI taxes.
Further, I have NOT thoroughly reviewed the laws in WI.
That said, this looks like it might be a good place to start (i.e., section 11.78, sub-section 1g).
If I understand 77.522 correctly, the bullion is sourced to a location in WI because you receive the product there.
Edited to add: links are to WI laws.
It's an "internet marketplace" thing based on YOUR STATE'S sales tax laws. If you have an issue, bring it up with the state of Wisconsin.
You may not have been charged in the past, but if WI has a sales tax on an item and you have it shipped in from out of state, you've always owed use tax on it, which is equivalent to sales tax. The recent changes that drove online venues to charge sales tax simply enforced the collection of said tax, where the vast majority of people never paid use tax. And if you buy something from someone who doesn't use a platform that charges the sales tax automatically, you still owe use tax.
No sales tax due on coins and bullion in Indiana. Yet
That's only helpful if you live in Indiana.
Yes. That works.
Dis this also apply to out of country purchases?
That depends on the rules of the state of Wisconsin. Probably, yes.
Here, read this:
https://www.revenue.wi.gov/Pages/FAQS/ise-remote-sellers.aspx
Typically use tax applies to anything for which you didn't pay the full home-state sales tax. As an example, I live in WA, which has sales tax (not on coins, so let's pretend we're buying something else, like a camera). Oregon does not. If I go to Oregon and buy a camera, I pay no sales tax. When I come back to WA, I owe use tax at the full WA rate. Now, if I go to a different state that does have sales tax, if I pay at least as much as WA's rate, I should owe nothing, but if I pay less than WA's rate, I could owe the difference to WA. This is where things get more complicated, because different states can handle this instance differently, and there are also differences depending on whether you bought an item and brought it right back to your home state versus using it where you bought it, and then bringing it back.
But in short, if you didn't pay any sales tax at all, you very likely owe use tax.
eBay sales tax on bullion and coins is a train wreck!! I live in Utah and there is no required sales tax but eBay charges me sales tax on every purchase I make and if I want it back I have to go through endless hoops and BS to get it, I’ve let several purchases accumulate and went through the song and dance twice. I am currently owed over $100 but honestly don’t even want to bother with it. I think eBay errors on the side of caution and hopes nobody says anything.
Same here, exactly,,,,,,,
I found the answer, don't buy anything on Ebay! My concierge member is useless. Now I just look there and hopefully the seller has a website. No more Ebay for me except to look............
Mike
My Indians
Danco Set
That's not -strictly- true.
For IN-PERSON sales, the location of the sale (and the state laws regarding what is/is not taxable and the rates) apply.
For Telephonic/Mail Order sales (including Internet), the buyer's location (and the buyer's state laws regarding what is/is not taxable and the rates) apply. This was settled in the Wayfair decision.
As with everything tax, that's just the surface of the onion...
If you do an IN-PERSON purchase in another jurisdiction, the buyer is required to pay USE TAX equivalent to the sales tax when the item(s) are brought into the home jurisdiction, depending on the state laws regarding what is/is not taxable and the rates. There is typically a reduction for any sales tax already paid.
EXCEPT: There are several state tax treaties where the tax rate of the higher state is collected as part of the sale in the lower tax state based on the buyer's residence. NY/NJ used to do this (not sure if they still do).
ANA 50 year/Life Member (now "Emeritus")
We're talking eBay...
The sales tax has pretty much eliminated by ebay purchases. Everything gets taxed by default even when it shouldn't.
Ebay sales tax levels the playing field between ebay sellers and retailers. Ebay is no longer a hub of garage sales. This is why the on line tax law change was supported by retailers.
The game was over when Amazon changed sides. They had established nexus in so many states, they couldn't avoid the sales tax anymore so they stopped fighting it and started supporting the sales tax.
Frankly, there is an element of fairness to it. Mom and pop B&M's were all but wiped out by internet sales. And then the remaining big box stores were getting hammered by the internet. We were in danger of having no local stores left.
The Wayfair ruling has actually increased my sales substantially in NY.
It also helped to clarify a horribly complex situation. The Wayfair decision made it clear to the states what law(s) they needed to enact. There are now a couple of companies that make sales-tax-as-a-service software. You feed it the goods & address and it kicks back a rate.
eBay's problem is they don't force sellers to properly classify goods. If you list a collectible coin in the bullion category, the software says, "oh, bullion, in Xy: non-tax". If you list bullion in the collectible coin category, the software says "oh, coin in Xy: tax 6%". Where eBay seems especially stupid is if you list in multiple categories that have different tax characteristics in some locations.
ANA 50 year/Life Member (now "Emeritus")
It's a crazy mess that is hard for ebay to control. If you are Walmart, you can accurately control the listing characteristics. If your eBay you are at the mercy of your users and your categories may not line up with the designations of the hundreds of taxing jurisdictions.
[Not that ebay didn't have other tax implementation problems. ]
People have always exploited this freedom. When ebay bucks or gift cards had bullion exemptions, sellers just listed under coins. People list coins under bullion to take advantage of the lower FVF. I've actually had people ask me to move something into a different category to bypass category restrictions. Once, I was even asked to put a numismatic item in the jewelry category because they had done kind of coupon or gift card.
Wait. Where do I find the SKU on my dateless Buffalo?
@daltex the US Mint bar code is on the rim, but you need Nic-A-Date to show it.
ANA 50 year/Life Member (now "Emeritus")
Sprawl-Mart and Amazonia have the same problem in their marketplace sections. It's just smaller volumes so fewer total complaints.
ANA 50 year/Life Member (now "Emeritus")
You can see it if you just,Zoom in with your digital microscope. It's right next to the portrait of George Washington having lunch with Jesus.
If I bid on something at Heritage and have it shipped to Ohio, since Ohio doesnt have sales tax on gold or silver there is no tax. But even if I bid on Heritage items and tell them to ship to my other address in Maine they charge me sales tax. It has to do with the ship to address.
With eBay it doesnt matter those idiots just charge tax on everything. So I have been keeping track of the sales tax eBay charges me on my coins, gold or silver, and will file it with my taxes next year for a return. They are idiots at ebay!
@Herb_t - good luck with that.
Let me save you a lot of problems. Income taxes and Sales taxes are separate returns.
In most jurisdictions, to file for a refund on improperly collected sales taxes, the request must come from the party that improperly remitted them. In order for them to be refunded to a third party requires an affidavit from the remitter that they won't file for a refund.
ANA 50 year/Life Member (now "Emeritus")