Heritage Auctions: Retroactive Sales Tax Charge
MikeD
Posts: 36 ✭✭✭
Did anyone else receive an email from Heritage about owing NYS tax from auctions in 2024? I received 6 invoices for auctions back in 2024 saying I owe more in sales tax for NYS. They provide no detail on the error, just say I owe thousands extra for purchases over a year ago. I have other auctions I won in 2024 that weren't included, so do I have another bill coming?
I called and the invoices are legitimate in my HA account so its not a scam. It is absurd.
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Each state has specific rules dealing with circumstances where it charges a business sales tax. If a business has an office or people working there, state sales tax applies. If not, each state as a sales volume threshold over which a business must get a sales tax permit and charge sales tax on sales of (usually only tangible) property. I guarantee you that Heritage has sales exceeding such volume in New York.
The only question I have pertains to possible exemptions for numismatic items. Some states don't charge sales tax on coin sales. Others, like CA do not charge sales tax if the sales amount on a single transaction exceeds $2,000. I would contact Heritage and ask them what is the New York law on this. They would know.
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In the future have a dealer that is out of state bid for you.
To clarify, they charged me sales tax in my invoices back in 2024. They are saying today they charged me the wrong amount without detail and I owe more than I had paid in 2024.
So Heritage screwed up their calculation in 2024 and are coming after me for the difference now, again without detail and since they overwrote their invoices in the system, I cannot verify the change.
I assume I am not the only one hit? And what are the chances they come back for taxes missed in 2023 or earlier?
This isn't about avoiding sales tax. It's about being charged retroactively for taxes that Heritage miscalculated over a year ago after paying some tax, but apparently not enough.
Perhaps Heritage missed the local sales tax that normally is added to the base rate NY State sales tax (4 %) ? Add another 5% or so on top of that if you live in NYC.....The total tax varies based on your zip code in NY state.
Commems and Early Type
Should be easy enough to calculate the percentage on the total, including shipping, and compare it to you local rate.
I presume NY went after HA for the difference and HA came to you.
I also presume that the issue you have is not whether you owe the tax but whether HA should eat the loss because it was their error.
All comments reflect the opinion of the author, even when irrefutably accurate.
That's exactly my issue. If Amazon sent me an email and said I owed more on the TV I bought 5 years ago because they miscalculated my tax, I'd be equally as annoyed. Its terrible business, especially since they just sent the invoices in an email like it was nothing. I could have also missed it, the email had a subject like the header I used for this thread and sounds like its a notice updating me on how they handle their taxes. I don't like surprise tax bills from over a year ago. I also don't know what they originally charged me, the updated invoices show no details of the change.
Did anyone else receive a similar email and invoices? I assume I am not alone.
terrible way to account for this. i hope their inside "paper trails" are better than this
your thread might be viewed more if you had a more descriptive subject line ;-D perhaps retroactively charging NY sales tax (eliminate auctions)
Tell Heritage you already paid your Use Tax on said coins, so no additional sales tax is due.
Besides, it’s their responsibility, not yours. They are just hoping to collect from you.
i can see how they'd want you to pay since it's the government expecting a purchaser to pay all sales tax (like at the register)
but they need to find a way to eat this. auction credits?
I received similar. I live NYC.
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Massachusetts is exempt for purchases $1000 or more in a single transaction.
I think it is unfortunate but I dont see a way out unless you want to sever ties with them. That would also be unfortunate.
As far as fairness goes I have no opinion.
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Better still, get a mailbox at The UPS Store in Pennsylvania and have HA ship there.
You would probably have to change your address on your payment method also
All comments reflect the opinion of the author, even when irrefutably accurate.
It's not clear if Heritage did their own audit or NY state caught their mistake, but if it is owed, better to pay Heritage than wait to hear from NY state who will tack on interest and penalties.
NY has one wicked computer system, they used to audit luxury stores in NJ to find NY residents who were shopping in NJ to evade the sales tax on clothing.
If you made big purchases, it's odd that you didn't notice that they were collecting too little sales tax for your address.
Commems and Early Type
odd they didn't notice it
New York has multiple tax jurisdictions in the state with different rates
All comments reflect the opinion of the author, even when irrefutably accurate.
1.Contact heritage and ask for a detailed accounting of sales and taxes that that you have already paid and amounts they say are now due. Ask for the reason why this is just now coming to light. Indicate that you will pay the tax as soon as you receive the detailed information requested. Don't wait for the State of New York to contact you. Get this problem solved quickly.
@MFeld any details on this?
I reached out to their help and they'll get back to be in 24-48 hours. Not very satisfactory for a surprise invoice and not a headache I should have to figure out.
I'm not going to go out of my way to avoid a sales tax and I don't think it matters because there is still a use tax. While I'd rather pay nothing, I'm not going to skirt the law.
However, if Heritage charges me some sales tax, I expect it to be correct and when the invoice is paid, I expect it to stay paid. Would they send me a surprise invoice 2, 3, or 10 years later if they missed it even longer? Do I have another email pending for other invoices that they are still reviewing? How about if the buyers premium was wrong or the credit card fee, would they came after me? A couple of days later would be one thing, but more than a year is excessive. I doubt they'd refund me if it was the other direction. It's just bad business and it doesn't seem like I was the only one hit. I'm quite frustrated by the lack of information and the bill itself, so maybe venting a bit, but it sets a really bad precedent for anyone that buys from them.
it reads like, 5 years from now, whoever reads those new invoices won't know what is being charged for what
They likely had an audit of tax year 2024 and the info came out recently or New York sent them a notice.
It is a poor look for a business to come back to the customer after an extended period (especially without a more in depth description of what happened and when the company made the mistake) but it is not against any laws. I've seen this happen in other industries where a seller sends invoices for prior year charges that were missed. There could be a case made for just ignoring the invoices but then you run the risk of 1) being banned from using HA and 2) them passing along the information to New York, who would come after you directly. Given that HA made the mistake, the best solution would be for them to cover the tax or at least offer to split it. Hopefully someone at HA sees what happened and comes up with a more satisfactory answer than what they have done up to this point.
Totally agree. They make enough money. They should eat it as a goodwill gesture.
Passing their mistakes onto customers does nothing to encourage them to get things right. I honestly can't imagine @ianrussell ever doing anything like this.
If I got a bill like this, I'd ask to speak with someone senior, and ask them whether getting paid a year after the fact was worth losing my future business. And then I'd act accordingly.
I wouldn't stiff them, and risk having them fire me as a customer. I'd take the high road, give them their money, and fire them as my auction house.
After all, they are big and awesome, but far from the only game in town. And something like this, quite frankly seems petty and minor league, given that, by definition, it can't be more than a few percent of any given invoice. Far less than the commission they certainly made on each invoice.
I went to a Dr one time and an extra bill just for the Dr's time. Nothing surprises me these days 😕
Note: the bill got erased after a call, its good now
Unless the State of New York is the one coming after you. the real question is how important is Heritage to you?
A few years back, during the jump in fuel prices, I had a supplier send me a $1,000 dollar bill out of the blue. They said they didn't charge me a large enough fuel surcharge on my 3 previous invoices. James
Every state has multiple tax jurisdictions with different rates; there are something between 10,000 and 40,000 different ones (depending on whose numbers you want to believe).
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It works the other way too.
In August 2024 I ordered some socks from Amazon and they sent me the wrong ones which I returned.
Amazon didn't issue the refund which was around $50.
In May 2025 I received an email from Amazon that they had been checking their records and discovered that they owed me the refund which they then credited to me.
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They can send an explanation of the mistake, and request payment.
However, they should take responsibility for their mistake and be understanding if you choose not to pay it. Blocking you for their mistake is unethical.
I would wonder how much upon hearing.
I would need to see the detail, backup. What an unpleasant surprise. Hopefully not a very high number.
Don't you still have your original invoices that came with the coins?
It’s the vendor’s responsibility to collect the sales tax and remit it to the state of NY. However, it’s the purchaser’s responsibility to pay the tax. I live in NY and also got one of these emails. I didn’t pay the tax so you could say it’s ultimately my responsibility.
The issue though is we all have budgets and need to manage our cashflow. This was one of those surprises that just doesn’t feel good and it should have been handled in a better way by Heritage. Surprise invoices with new past due balances is never good business.
As mentioned, HA may have gotten audited. And I would bet that NY has sent them a bill for the taxes not collected and now HA is trying to get them back from customers. I would think that if HA is sending out invoices for back sales tax, they have to have adequate records to show who owes what. Seems they should at least have to provide you with proof of actual dollars owed per transaction. In the long run, the bill is still yours, but I know I would want the proof as it being my bill!!
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I do not know how this issue was uncovered (e.g., a sales tax audit).
That said, in the case of a sales tax audit, there is a statute of limitations. Per this reference, the "general limitation period" is 3 years in NYS.
Anyone dealing with HA on this issue might want to ask about any pending bills.
No, the emails they sent when the purchase was made are links to the invoices, which are now retroactively changed to reflect the update. I can probably piece it together and probably should have had the PDFs saved on my own computer, but they should also provide a clear break down and ideally a call would have been nice.
I've asked about whether there will be more of this as they only hit 6 of my invoices of about 30 during the period, and even more from before 2024. They'll get back to me in 24-48 hours (I'm not holding my breathe, the CS rep I spoke too could not have been more indifferent). I'm also a legacy client, not that it ever meant much.
They clearly have systems issues. One time they had my account up for another issue and shortly after someone entered a bid for me. Apparently they never exited my account after helping me and when they went to enter a phone bid, did it under me instead of the other person. That was another fun surprise email.
Don't you get a paper copy of the invoice along with the coins? I have not bought a coin since it was ruled that sellers had to collect sales tax where appropriate so I don't know if Heritage includes it or not.
Good point. I think I have them filed away in a box of receipts somewhere but might have shredded them. Not sure it will be worth digging out for me personally. I admittedly should be saving and tracking this all better and I guess if I ever buy from Heritage will have to be significantly more careful, but it seems extra unprofessional that they retroactively modified the invoices instead of issuing new ones. They even show as past due from the original date. So far they haven't tried to get overdue fees or interest, but I assume that will come eventually.
I am so glad I retired from New York to South Carolina years ago. There were several other reasons but never again having to deal with sales tax on coins and currency is certainly a nice bonus.
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I read that as they sent you a paper currency $1,000 bill, or G-note. I need more coffee.......
I read it the same way.
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Heritage should be responsible for any penalties I would think.
I can assure you. I have been in business since July of 1982. In all that time all the bills have me paying them James
Was additional tax related to the buyer's premium?
If so, this might explain:
https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales/24-48s.htm
Fascinating!
That may also explain why only some invoices were adjusted; potentially only the invoices after this decision date.
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I don't think that is it. For most of them for me at least, the correction is most or entirely the tax they are now noting is due. That means they calculated the sales tax as 0 or much lower than it should have been, not just an adjustment for the buyer's premium. In hindsight, maybe it was obvious that it was wrong, but NY also has exceptions for things like bullion (not sure if that applies for auctions) and I did not look closely last year, just assumed it was correct.
They do have this fun little notice on sales tax that I am sure no one reads. Not sure how binding it is, but basically they can claw back extra tax owed any time, which is crazy to me. https://coins.ha.com/c/ref/sales-tax.zx
I never said otherwise. My response was to a question about how Heritage could have charged the wrong rate to the OP who lives in NY. Thank you for confirming my point.
All comments reflect the opinion of the author, even when irrefutably accurate.
Heritage's T&C (revised 4/25)--see paragraph 27(sub 2)--unsure if version was the same in 2024.
https://www.ha.com/c/ref/terms-and-conditions.zx?view=terms&ic=footer-auction-terms-080124
No comment on enforceability! Sure Heritage was also not happy with that Advisory opinion- from an all around business prospective.
Interesting, the terms say buyers are liable for any interest or penalty from unpaid taxes to the authorities, even at their fault or misinterpretation. I wonder if they are passing on the NYS tax penalties. That would be very bad practice to pass on.
Terms and conditions:
But the sales tax page (https://coins.ha.com/c/ref/sales-tax.zx) does not include that clause: