Quote:
Originally Posted by tschock
I will attempt to ask this again...
Isn't ebay over collecting the taxes? If I sell to someone in South Dakota, ebay will collect the sales tax automatically. But if I don't make 200 sales or sell over $100K to South Dakota, does ebay reimburse that/those buyers (since I didn't meet the South Dakota sales tax collection requirements)? I highly doubt it. Or is ebay itself considered the 'retailer' in this case? Inquiring minds want to know.
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This is my understanding of it. Ebay is considered a "marketplace facilitator". As of last check about 30 states had passed legislation to say that if an item is sold out of state through a marketplace facilitator (like eBay), then tax is required, regardless of the thresholds that small business hits sales wise into said state. The marketplace facilitator will be way over those thresholds anyways. As a small business owner, if you purchase from me directly (website, facebook, BST, etc) and not through a marketplace facilitator, I am only required to collect sales tax if I am going to cross whatever said threshold of sales that your state has set. So, if you lived in South Dakota and you purchased something directly from my website, I would not charge you tax because I will not have 100K sales or 200 transactions to South Dakota this year (or previous year, if that's how they keep track of it). If I am wrong anyone please feel free to correct me but when I researched it that's how I interpreted the legislation.