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Asking sales tax questions can help you avoid sales tax problems.

Everyone in business has a sales (or use) tax question. What's yours?

If you manage sales tax issues for a small-medium business, the odds are that you have a sales tax question on your mind. If so, we'd like to hear it.

Have your sales tax questions answered by a noted sales tax authority.

Every week, one sales or use tax question (submitted by a small-medium business user) is selected and a thorough response is provided by noted sales tax authority Diane Yetter - of YETTER. Rest assured, your name and/or firm details will NOT be posted. We may also modify your question somewhat in order to make the information more anonymous - and/or to broaden its educational value for other Sales Tax Support users.

SUBMIT YOUR SALES TAX QUESTION HERE.


Learn by reading responses to other sales or use tax questions below.

Even if you don't want to submit your own sales tax question, you can benefit by reading Diane Yetter's informative responses to other questions in our Sales Tax Questions Archive below. To quickly find sales tax questions that match your interests, simply select an item in either drop-down box.

Sales Tax Questions »

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Question/Topic  Contributor  Date 
We are based in NC and are currently under contract to perform work in several other states (GA,VA,SC). These are all federal projects non are private work. If I travel to GA to perform services and I supply both materials and labor that I sell to a party who then sells it to the Primary General Contractor who then...(Click to see complete question and response)
Diane L. Yetter of Yetter 2012-01-13
If we do not register to pay sales tax and do not get exemptions from our raw material suppliers but elect to pay sales tax on the raw materials and not charge our customers sales and use tax is that legal?
Diane L. Yetter of Yetter 2011-12-21
What resale certificate does a contractor use for the resale of materials and service?
Diane L. Yetter of Yetter 2011-12-19
We are a small contractor operating in New York. If we have a subcontractor working for us and we don't want to be charged sales tax, when it's a capital improvement project, how do we complete the ST 124? Do we complete the customer section of that form and our subcontractor complete the contractor section?
Diane L. Yetter of Yetter 2011-12-16
OUR BOOKKEEPERS FAILED TO PAY USE TAX OR SALES TAX ON THE GAMES WHEN THEY WERE PURCHASED. HOW MANY YEARS CAN THE STATE GO BACK? IS THERE A STATUTE OF LIMITATIONS ON THE TIME FOR COLLECTION?
Diane L. Yetter of Yetter 2011-12-12
WE ARE DEVELOPING SOFTWARE WHICH WILL BE USED BY A CANANDIAN COMPANY IN CANADA. WE WILL ALSO BE PROVIDING CONSULTING SERVICES TO THE SAME COMPANY. DO WE HAVE TO CHARGE ANY TYPE OF TAX TO THE CANADIAN COMPANY AND IF SO, WHAT KIND AND HOW IS IT REMITTED.
Diane L. Yetter of Yetter 2011-12-09
We are a dealer/reseller located in PA. Our vendor is located in MI and our customer is located in MD. We have no nexus in MD. However our customer is requiring us to collect the sales tax from them. If our vendor drop ships to our customer and collects MD sales tax ...(Click here to see complete question and response)
Diane L. Yetter of Yetter 2011-10-19
We are establishing a procedure for tax exemption certificate management. What is the difference between a Resale Certificate and Tax Exempt Certificate? If a customer presents a resale certificate from their state does that qualify as an official tax exemption certificate? Your website provides an overview of each state and the resale certificate periods for each state. Are those periods the same expiration periods for a exemption certificate?
Diane L. Yetter of Yetter 2011-10-18
I am a printer located in Allegheny county, I have several clients in different counties. Do I charge them sales tax for Allegheny county, or the sales tax rate according to what county my customer is located?
Diane L. Yetter of Yetter 2011-10-17
Hello, we have been doing business in a number of states (renting goods), which gives us nexus and are considering expanding nationally, but have heard the administration is more than just filing 50 returns. I've learned that some states have "home-rules" and those cities/counties can force you to file returns by city/county/district. I was wondering...(Click here to see complete question and response)
Diane L. Yetter of Yetter Consulting 2011-09-16
When filing sales tax returns, is a company required to include all sales or just taxable sales?
Diane L. Yetter of Yetter 2011-09-15
We provide personnel to perform fiber optic and pipeline inspection throughout the US. Should we be charging our clients sales tax for these services?
Diane L. Yetter of Yetter 2011-09-02
We have nexus (sales person in Fl) in Florida and we are HQ in Parker, Colorado. Do we collect sales tax from our customers that are not located in Florida but drop shipping their order to Florida?
Diane L. Yetter of Yetter 2011-08-29
We are a fairly new NC consulting company that occasionally buys products and resells to our customers, also located in NC. I am unclear about what sales and use tax to pay. On products that we purchase for resell, do we pay use tax only if we were not charged sales tax on the product? When we resell the item, do we charge our customer sales tax, regardless of whether or not we were charged sales tax when we purchased the product? Or is this a separate tax? How are these taxes reported? Why does it seem as though tax is being paid twice?
Diane L. Yetter of Yetter 2011-08-25
We collected sales tax starting in 2005. It didn't get reported until 2007-2008 and we were hit with huge penalties that are more than the actual tax and we can't pay it. Is there a statue of limitations? In addition, is there any way to negotiate just paying the collected tax without the penalties? Should mention we are in chapter 13 because of this but may have to convert to 7 because we can't pay the taxes/penalties in the 5 years.
Diane L. Yetter of Yetter 2011-08-24
We are a Canadian corporation. From our Canadian head office we resell to US clients in different states gas analysis equipment manufactured in Finland by our mother company. We have recently shipped equipment to our client in Gillette Wyoming, our invoicing to be sent to Texas...(Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-08-08
We self-assess use tax. My question pertains specifically to services. What jurisdiction should be assigned to a purchase order for engineering services, repair services, or support services? Is it the jurisdiction where the services are actually being performed or is it the jurisdiction where the the services will ultimately be... (Click here to see complete question and response)
Diane L. Yetter of Yetter Consulting 2011-08-08
We have graphic design services company, and is going to be selling handmade t-shirts in the future. We applied for the state tax ID in GA, and we got a letter saying that I need to be paying taxes monthly for the first six months. Incomes are through services only, and we used the tax id to get t-shirt supplies. No t-shirt sales yet. Do we have to file taxes on... Click here to see complete question and response)
Diane L. Yetter of Yetter Consulting 2011-08-07
We are an IT Managed Services company and support SMB computer networks (firewalls, routers, servers, PCs) and we have contracts with our customers for Professional Services, of which roughly 85% are done over the Internet remotely. We will sell hardware and software to clients as a convenience and pay Sales Taxes on those products. Should we have to pay Sales Taxes on our Professional Services (knowledge)?
Diane L. Yetter of Yetter Consulting 2011-08-05
I own a bar in California. I am wondering what would be considered a nontaxable transaction when reporting sales tax. The deductions which would be reported on line 11..
Diane L. Yetter of Yetter Consulting 2011-08-04
I believe our CT sales tax has been increased to 6.35% as of today, July 1. I have existing orders placed by customers who paid a deposit, including 6% sales tax. Many of these orders will be completed and ship or be picked up on July 1st or later, and the balance payments are run at that time, currently calculated to include 6% sales tax. What are we responsible to do? I'm sure our customers do not expect to pay more now, for something they ordered previously, and we cannot absorb all this new tax.
Diane L. Yetter of Yetter Consulting 2011-07-06
I just found out that my company is supposed to be collecting sales tax. We have never collected sales tax,therefore never remitted to the state. What do we do now?
Diane L. Yetter of Yetter Consulting 2011-07-05
Our Tennis Department purchased calendars from a vendor to distribute to members as promos. The vendor did not charge us sales tax. Is this ok?
Diane L. Yetter of Yetter Consulting 2011-06-27
I have a new business and I'm not sure how to file and pay the sales taxes that I have collected... Essentially, I wanted to know how I could pay back my sales tax collected from clients, back to New York. (Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-06-23
We sell music downloads online. We'd like to start selling physical CD copies online. What sales documentation do I need before I start selling physical CDs?
Diane L. Yetter of Yetter Consulting 2011-06-22
I have been a photographer for 10 years, filing taxes in VA. I move to NC every summer where I photograph families (from NY, NJ, PA, etc) and post their photos online for ordering - although I often arrange job from NC. I have recently been contacted by VA tax auditor... (Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-06-17
We are an ecommerce-only company, that acts like a broker for our vendors. We transact the sales and pay the vendors once the products have shipped. Do we need to pay sales tax for sales made to customers in those states where the vendors are located? (Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-06-15
We are direct selling company shipping products from the state of Idaho to independent distributors in various states. Are we required to collect and remit sales tax on shipping charges?
Diane L. Yetter of Yetter Consulting 2011-06-13
If I didn't collect sales tax this month do I still have to file a Sales/Use Tax Return?
Diane L. Yetter of Yetter Consulting 2011-06-12
Assume my product is a unique line of "clothing" for dogs available only online from my NY based business. A pet store owner with locations in NY, NJ and CT will not stock my product in his store however, he is willing to produce a a flyer and give it to his customers when they check out of his store. I am willing to pay him 10% of sales for any of his customers that make a purchase from my website. It's clear to me I need to collect sales tax on the items I ship to NY customers. But, does the store owner's promotional activity (not mine) trigger nexus for me in CT and NJ?
Diane L. Yetter of Yetter Consulting 2011-06-09
I am contemplating selling via the web a line of goods. My promotional activity will be in the NY metro area but the majority of sales will come from the NY/NJ/CT area... (Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-05-23
Our corporate location is in Maine where we have a Resale Certificate, but our warehouse is in Missouri. We order from our Corporate location for shipments to our warehouse or as drop ship direct to customers... (Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-05-18
I need a guideline as to how to handle sales in DE and MD when our company is based in PA. (Click to see complete question and response.)
Diane L. Yetter of Yetter Consulting 2011-04-13
I am worried that my company does not charge sales tax to customers who are out of the state simply because we are not yet registered with that state. One customer of ours owns franchises all over the US... Click to see complete question and response.
Diane L. Yetter of Yetter Consulting 2011-02-24
I want to fill out my sales tax form for 2010. I will have no sales to report. I fill out the sales taxes annually. What form do I use? Where at the Maine website is the form that I fill out? Thank you
Diane L. Yetter of Yetter Consulting 2011-01-24
Our company helps distribute products from small vendors (who also have e-commerce site and other distribution channels) through a network of direct distributors who sell directly to the end-consumer in-person or online.... Do we create a nexus for the vendors in each state where we have sellers?... Who is responsible for collecting and paying sales taxes...?
Diane L. Yetter of Yetter Consulting 2011-01-24
Our company is located ONLY in Palatine, IL. We sell a garden product. We will have a booth for one day this January at a show in Valparaiso. We will be selling retail that day. Are we required to collect sales tax? If so how much (7%?). We have no employees or representatives acting on our behalf in any state.
Diane L. Yetter of Yetter Consulting 2011-01-03
I am a Rhode Island Plumbing Contractor. I pay my sales tax for material and all other purchases with the exemption of sub-contractor made to the Vendor direct... When I make a sales, I do charge the customer the RI sales tax of 7%. I need to find out if I am legal in what I am doing.
Diane L. Yetter of Yetter Consulting 2010-12-15
I have created a program that I am ready to sell online. I set up an account on google checkout to process my transactions but they do not offer support as far as what tax to charge. I am in Louisiana and hope to sell copies everywhere. My question is how much tax to charge?
Diane L. Yetter of Yetter Consulting 2010-12-03
Can sales tax liability be reported at time of payment not time of invoice?
Diane L. Yetter of Yetter Consulting 2010-11-03
We are a newly formed management company wanting to pay sales tax for a motel. We are not the owners - we just manage and pay our staff. The property also has a contractors' lien. Is there a way to pay sales tax under our corporation - instead of owners?
Diane L. Yetter of Yetter Consulting 2010-10-13
In 1991 I owned a Bar which has since closed. The state of Wisconsin is saying I owe sale/use taxes for that year and have tacked on interest and penalties of $28,000 to add up to $41,000 and they are trying to collect it by levying my Business account.
Diane L. Yetter of Yetter Consulting 2010-09-27
NH based bakery delivers product to Maine and Massachusetts customers, both retail and wholesale. Are we required to collect sales tax for those deliveries in those states?
Diane L. Yetter of Yetter Consulting 2010-09-06
We are offering internet based webinars that offer Continuing Education to customers. Customers are recruited solely via the internet using ad words, email lists, etc. We are charging the customers for participation in the CPE presentation. Operations are in Massachusetts. Customers are all over the country (in fact all over the world). Any nexus issues? Now--what happens if we attend a trade show in another state (once a year) to market? Have we created nexus in that state? What happens if we hire presenters in a given state? Does that create nexus in that state? What states might tax this service of webinars and therefore it might make sense to file a zero sales tax return just to protect oneself? Or would be advisable to NOT register for sales tax in a given state--I've read that creates nexus.
Diane L. Yetter of Yetter Consulting 2010-09-06
AL has numerous self-administered jurisdictions. If the client establishes nexus in one city due to sending a vendor to provide services on the customer's site, does that mean the client automatically has nexus in every jurisdiction in AL, and therefore charges both state and local (sellers use) tax on every sale they make within the state?
Diane L. Yetter of Yetter Consulting 2010-07-27
Do we charge people (from out of state) sales tax? Do we charge them our rate, their state rate - or nothing at all? We are in MA - but also have customers from NH and NJ.
Diane L. Yetter of Yetter Consulting 2010-07-27
We have a promotional business, based in MA. Do we charge people out of state sales tax? NH - has no sales tax. However in NJ do we charge 6.25% (MA) rate - or in NJ-7% rate - or nothing, where they are out of state?
Diane L. Yetter of Yetter Consulting 2010-07-26
Do we charge a state sales tax for items purchased by phone or internet for other states and is there a difference between a phone order and a customer purchasing on site to send out of state? Click to see complete question and response.
Diane L. Yetter of Yetter Consulting 2010-02-22
NV company with e-commerce web-site was advised to charge sales tax on CA sales... They are concerned that CA sales tax application requests much personal information. Click here for complete question and response.
Diane L. Yetter of Yetter Consulting 2010-01-28
Company X operates in Iowa. Company X receives a contract with company Y located in Nebraska to install piping for a chemical storage facility. Company X files forms (24, 24A, 24B and 24C) elects Option1 - Retailer - Tax-Free Inventory. What tax if any is owed to Iowa?... Click to see complete question and response.
Diane L. Yetter of Yetter Consulting 2010-01-27
If you do not have nexus and therefore do not collect/remit the tax, can you be held liable if the customer does not pay the tax?
Diane L. Yetter of Yetter Consulting 2009-06-10

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