Shipping....and Sales Tax

[skyhigh]

Foolish question for the day.....

When shipping a sign to a customer..... do you add the shipping cost to the cost of the sign.....then tax that amount?

In the past, I would only charge tax on the sign.....THEN, add the actual shipping cost. I was told that is incorrect!!????

 

[Cole Not Cold]

We do not apply taxes to the shipping rate. We are not claiming S&H as sales, so we won't pay sales tax on that. I know companies that do add tax to S&H since most customers won't notice. But that seems like a shady business practice.

 

[tattoo.dan]

Yeah, we don't tax shipping either. We must be doing it wrong too then!

 

[skyhigh]

We do not apply taxes to the shipping rate. We are not claiming S&H as sales, so we won't pay sales tax on that. I know companies that do add tax to S&H since most customers won't notice. But that seems like a shady business practice.

2 points....
1) I wouldn't say "shady", as any tax would go to the state. There is no benefit to me.
2) The "shady" person that told me this, was the PA Dept of Revenue. (go figure) So yeah, shady business practice. :ROFLMAO:

 

[J Hill Designs]

next they will want you to tax the sales tax :ROFLMAO:

 

[Gino]

We did the same for years. About 25 years ago we were informed, whether it be common carrier, UPS or Pony Express..... that all gets added into the total equation and the sales tax is added in at the very end. It's a part of your doing business.

 

[royster13]

https://revenue-pa.custhelp.com/app...and/or-handling-charges-subject-to-sales-tax?

 

[Pat Whatley]

Same in Alabama...shipping is taxable.

 

[Fred Weiss]

Florida too. Any intangible or service that is part of selling a tangible product is taxable.

 

[Cole Not Cold]

Well how about that.

 

[2B]

Same in Alabama...shipping is taxable.

Same here and the IRS does verify you are paying it

 

[John Butto]

I assumed that if you are a destination state (NJ, and a lot of others) and shipping out of the state you do not have to charge sales tax.
Pennsylvania is an origin state which has to charge sales tax when shipping out of state.

 

[MR. Graphics]

Everyone who said tax the shipping is right! especially Florida, Just got out of a accounting class at the Florida State College of Jacksonville. A side topic was about taxing the shipping. The government is trying to do that to ebay sales by state. How would you like to call all the states once a month a report no sales and send checks at the states rates for each sale...Nightmare!!

 

[royster13]

Everyone who said tax the shipping is right! especially Florida, Just got out of a accounting class at the Florida State College of Jacksonville. A side topic was about taxing the shipping. The government is trying to do that to ebay sales by state. How would you like to call all the states once a month a report no sales and send checks at the states rates for each sale...Nightmare!!

Not even close to a "NIGHTMARE".....If this day ever comes, state taxes will be built into programs like QuickBooks.....Every month (or what ever the period is) you can ask QB to make a report......Then you will send the report and your payment to clearing house (service provider) who will file and pay on your behalf (and 1,000s of others).....