There are almost 10,000 sales tax jurisdictions in the United States. Each with their own set of definitions for what is and isn’t taxable.
Worse, if you run your own business, doing taxes is a job that doesn’t get you paid. Time invested in navigating sales taxes usually produces a hassle, not a profit.
Which is why the right state sales tax help and knowledge is so important.
State Sales Tax Help- Part One
5 Sales tax facts
- There is no national sales tax, and the federal level of government rarely gets involved in monitoring and regulating sales tax laws.
- Sales tax rates are determined by the states and local municipalities 45 states and Washington DC impose some sort of sales tax on their residents and businesses.
- Many counties and local municipalities also charge an additional sales tax. With all of the state and local codes, there are almost 10,000 different tax jurisdictions in the United States.
- Rates and what governments consider taxable all differ from place to place. Food is a big topic of conversation when it comes to sales tax. Certain states don’t charge a sales tax on most foods. Other states charge a reduced sales tax of 1 or 2 percent on foods. Then some states have 3 pages of regulations on what is ‘food’ and what is ‘candy’.
- Something called a use tax is considered ‘complementary’ to sales tax. If you buy something from another state, or from online, and don’t pay a tax on it, you more than likely are still expected to pay your state those due taxes. You have to figure out what the tax rate for that specific item is, then you have to get the correct form and fill it out. Mail the form in with a check written from you directly to the part of your state government that handles taxes
Keep in Mind:
This also applies to municipalities. If you have an additional city or county tax, you have to get that separate form, fill it out, and send it into the correct local office. (This doesn’t happen more than it does.)
Not only are you expected to pay more money for something already in your possession, but it is also almost impossible to enforce.
Cue South Dakota v Wayfair and the birth of states taxing online marketplaces.
It’s easier to monitor and compel businesses to remit taxes than it is to track every individual who may have bought something off the internet.