I just got my annual St 102 from the Dept. of Taxation and Finance. How do you guys do your tax? Do you charge extra for every shirt? Am I supposed to be charging tax on everything? I may have messed myself up a little and I don't know if I charged enough to cover all that. Thanks.
If you did not collect sales tax then you need to calculate it. If your tax is 7.75% then you would divide your total sales by 1.0775 and multiply by 100 to get your retail sales number. You would then calculate your sales tax on that number.
Do you charge extra for every shirt? Am I supposed to be charging tax on everything
You'll probably need to contact your tax agency, but normally, you are supposed to charge tax on every sale in to customers in your state unless the person you are selling to has a sales tax exemption status for the purchase (like a sale to another wholesaler or a retailer who).
You normally charge tax when you are selling to the end user of that product (the one who will be wearing it/using it).
I realize that no one here is a tax lawyer so I will take your responses with a grain of salt and verify later...
But, what is -- in your experience -- the deal with collecting sales tax, online sales vs. "real-life" sales? Do you have to charge sales tax when you sell on-line? You always have to collect sales tax when you sell in "real-life" (except if they have a tax exemption), right?
When you collect sales tax, what do you do with it? Do you put it into a separate bank account to send at a specified time? And when (and where) do you send the money you collected in sales tax?
If your state has sales tax, for online sales you're meant to collect tax from customers within your state. There has been various attempts at legislation to make merchants collect tax on behalf of other states, but as far as I know that has failed thus far.
You'll probably need to contact your tax agency, but normally, you are supposed to charge tax on every sale in to customers in your state unless the person you are selling to has a sales tax exemption status for the purchase (like a sale to another wholesaler or a retailer who).
You normally charge tax when you are selling to the end user of that product (the one who will be wearing it/using it).
If you sell to a school or a school group that is tax exempt or a charity, if I have a copy of their number, does that exclude me from paying tax at all on that sale?
If your state has sales tax, for online sales you're meant to collect tax from customers within your state. There has been various attempts at legislation to make merchants collect tax on behalf of other states, but as far as I know that has failed thus far.
I belive this to be true as well.
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If you sell to a school or a school group that is tax exempt or a charity, if I have a copy of their number, does that exclude me from paying tax at all on that sale?
As long as you have a resale certificate you do not have to charge tax. Its up to them to collect the tax.
Make sure you get an updated resale certificate for all clients that supply to you at the begening of each and every year.
But, what is -- in your experience -- the deal with collecting sales tax, online sales vs. "real-life" sales? Do you have to charge sales tax when you sell on-line? You always have to collect sales tax when you sell in "real-life" (except if they have a tax exemption), right?
A sale is a sale is a sale. If the sale qualifies for sales tax (a customer within your state), then you legally have to charge sales tax and pay sales tax to the state. Doesn't matter whether it's online or offline.
you collect sales tax in the State you have a physical presence. States are not allowed to regulate or control interstate commerce so even though out-of-State sales may be taxable, it is up to the person that purchased your product to pay their State the sales tax. In California, they do that on their Income Tax form.
Try contacting your state taxation dept and find out if they give small business training or at least explain your tax responsibility to you. I know several states conduct training. They really would rather not have to come after you if you don't report your sales and pay your sales tax. Also, I strongly suggest investing in some small business accounting software if you don't have someone doing your accounting. Makes tax return time a breeze
There are also Governmental Agencies that are not required to pay sales tax. Many of our customers are Federal Govt. They don't have to pay sales tax, no matter what.
I can give you an idea of how Illinois works. First, apply for a resale tax certificate with the state. They issue a tax ID #. For the first year, you will file a monthly ST-1 Sales and Use Tax return form. On this form you list the amount of your monthly sales, how much tax you collected for merchandise sold, delivered or shipped within the state. You pay your tax via check or electronic transfer monthly. After the first year, the State will review your status to determine if your sales require you to continue reporting monthly, quarterly or annually. As mentioned above, tax is not collected on sales made to locations or parties outside your state unless you have a physical presence ie. office, warehouse, distribution center in the other state. Although you don't collect tax on sales made to other states, you must still report the amount of the sale as interstate commerce on your tax form.
You don't need a separate bank account for taxes, just be sure you don't spend the money you collected.
In this state, if you provide services in addition to material goods, and you list the services portion on a separate line, you do not collect taxes on the service/labor portion of the sale.
Can someone tell me if you are required to charge sales tax on customer supplied garments/products for either screen printing or embroidery? If I were to just do the printing or embroidery itself (labor) for a company who is not reselling the products.
I guess maybe what my question boils down to is wheter the labor to print or embroider something is taxable when your customer supplies the substrate.
By the way, I live in California but realize the sales tax laws could vary from state to state.
Sales Tax - How to Charge/Figure 
