Heritage and Stacks sales tax
Gazes
Posts: 2,315 ✭✭✭✭✭
Stacks sent a notice today saying they would apply sales tax to certain states. I spoke to a rep at Heritage earlier in the day and she said by the end of the year, they plan to charge sales tax in all 50 states. I assume others will follow. I think this a issue of mammoth proportion that could really cause a decline in coin sales.
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Pennsylvania exempts coin and bullion sales from sales taxes, without any threshold requirements.
The email I received from Heritage said the following:
Please note: As of August 1st, Heritage Auctions will be required by state law to charge applicable sales tax on any items delivered to addresses in Pennsylvania for the following categories: Art & Antiques, Books & Historical Manuscripts, Comics, Currency, Entertainment, Historical, Jewelry, Timepieces & Luxury Accessories, Movie Posters, Nature & Science, Sports, and Stamps.
It looks like Heritage will honor my State's exemption rules.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
Considering Iowa doesn't have a sales tax on coins I view this as a competitive advantage
Coin people who are in states with sales tax exemptions for gold and silver sales NEED to 'stay below the radar'. Most States need additional revenue, and these sales tax exemptions could be rescinded relatively easily.
Many of us are addicted to coins, many people are addicted to smoking cigarettes. I’ll keep buying coins and the cigarette people will keep smoking, tax or no tax.
That is interesting and as usual a negative in many ways, just like other auctions eBay, etc. I am in an exempt state for metal/coins, but who knows for how long that will last. I can't imagine paying 20% commission plus 8.7% sales tax to buy or sell coins at auctions like that under those terms, at this stage.
My US Mint Commemorative Medal Set
I can see it now..
"Shell Bidders R Us" - bidding by proxy in a no-sales tax state (Oregon, etc) for a low, low fee (2% final value fee on minimum bid of $xx,xxx, &c, &c). Escrow and credit services available at extra charge.
SO why hasn't someone done this. Or maybe they have. Is New Jersey a no-sales-tax state?
I specifically asked the stacks rep if a sales tax would be added to winning bids picked up at the ANA in philly and she claimed to look it up and said yes---6% unless it was a dealer with a resale cert
What if your dealer is in a state that has sales tax? I think there are fine points to the sup court decision people have not thought out. What about overhead for dealers who sell to all 50 states (ie accounting, taxes, etc)
In my State, retailers are allowed to retain a small cut from the sales taxes to cover the costs of collection,, record keeping, filing, etc. It is likely not enough, but it exists.
If they charge me a sales tax, I will be pissed (since I live in a no sales tax state)
Also for those who sell at auction it will have an impact---some bidders who have to pay sales tax will lower their bids accordingly. Some may altogether not bid. Your coins may fetch less. Dealers who know this will offer less for coins knowing that 20% commission plus sales tax will impact what someone can get for their coins at auction
Where the dealer is located makes no difference, I don't pay any taxes. If I buy from a dealer in NY who collects NY state sales taxes he wouldn't collect any from me assuming it is an online transaction.
Do you think your state may see what other states are doing and want to get a piece of amazon sales, etc?
We are on a coin forum talking about auction houses which sell COINS. Iowa sales tax exempts coins/bullion/paper money so if they sell them on Amazon they won't be getting a piece. I don't see where your coming from.
Geez !!!
Same thing last year. I went to pick up a lot at the Denver ANA, but would have had to pay sales tax, so I paid them to ship it to me. Seems stupid, but when working with government bureaucracies, stupid is standard.
It's buyer locus not seller locus
All comments reflect the opinion of the author, evn when irrefutably accurate.
It may change the hammer. It won't change the total price or number of sales. If I want to spend $1000 on a coin, I still will. What do I care if New York gets some of the $1000.
It may create competitive advantages for people in some states. But that inequity already exists
All comments reflect the opinion of the author, evn when irrefutably accurate.
When you buy in Colorado, you pay Colorado sales tax. Totally logical. No matter what you buy, the tax is applied.
The shipping loophole is what the states are trying to close
All comments reflect the opinion of the author, evn when irrefutably accurate.
This has always been the case.
All comments reflect the opinion of the author, evn when irrefutably accurate.
Here's a quick link to info on states that do and do not charge sales taxes on coins. I don't know how accurate the site is, but it's got South Carolina correct anyway: https://thecoinologist.com/sales-tax-state-by-state-breakdown/
For a 1 time fee of $250 (and I believe a $15 yearly fee) you can incorporate yourself into an LLC and not be charged sales tax.
but it's got South Carolina correct anyway
Another reason I'm glad I retired from New York to South Carolina.
Member ANA, SPMC, SCNA, FUN, CONECA
Being a Limited Liability Corporation (LLC) has no effect on sales tax. It is the resale certificate issued by your state of incorporation that exempts a business from paying retail sales tax. Most states require monthly or quarterly filings and these data are correlated with the business' personal property and other fees, and state and Federal tax returns.
Roger is correct. And, at least in NY State, property converted to personal use is subject to taxation. So, if you are going to get a resale certificate to avoid sales tax, you better be selling enough to justify your claim to be a reseller or you may end up getting charged with tax fraud.
All comments reflect the opinion of the author, evn when irrefutably accurate.
From Heritage website:
"Lots delivered to you, or your representative are subject to all applicable state and local taxes, unless appropriate permits are on file with Auctioneer. Bidder agrees to pay Auctioneer the actual amount of tax due in the event that sales tax is not properly collected due to: 1) an expired, inaccurate, or inappropriate tax certificate or declaration, 2) an incorrect interpretation of the applicable statute, 3) or any other reason. The appropriate form or certificate must be on file at and verified by Auctioneer five days prior to Auction, or tax must be paid; only if such form or certificate is received by Auctioneer within 4 days after the Auction can a refund of tax paid be made. Lots from different Auctions may not be aggregated for sales tax purposes."
OK, I get that....but I live in a very high sales tax area, and received no email (yes, I checked the spam folder). I would be majorly PO'ed if I bought coins from the ANA auction and had to pay sales tax when I had bid assuming none.
Just talked to Heritage. The info I was given: If you are now subject to sales tax (the list was about seven sates, I remember VT, HI and KY), you will receive a pop up message when you log into your Heritage account. If there is no pop up (I would recommend disabling any ad blockers), you are not CURRENTLY subject to sales tax. The rep I spoke with affirmed that they expect to eventually collect sales tax in all states that charge a sales tax.
Can you imagine sales tax on something like the 1913 Liberty Head Nickel or 1804 Dollar? I don't believe my state has a sales tax cap/max.
Well, it was shipped from California to Montana. They took Colorado out of the equation. There is no loophole to fix. However, I was driving in Wyoming when I made my bid.....they have a sales tax. Maybe they will charge based on the location where you bid.
I doubt there will be a decline in coin sales. Just possibly a decline in some realized prices.
In a similar vein, has anyone looked at the data regarding effect of increased BP on:
1) % of lots sold/passed
2) average hammer price on a generic issue
Honestly, it would help to have a uniform national VAT. That would simplify tax collection and eliminate the state to state advantage.
All comments reflect the opinion of the author, evn when irrefutably accurate.
TEA IN THE HARBOR !!!!
........... NOW ! ........
TEA IN THE HARBOR !!!!
Coins, paper money, and bullion over $1000 are already exempt from sales tax in Massachusetts.
Member ANA, SPMC, SCNA, FUN, CONECA