| Every business must collect sales taxes on taxable | | | | your obligation to collect sales tax is determined by the |
| products and services. As you start your business, the | | | | location of the buyer. If the buyer is located in a state |
| first thing you must do is determine if your products or | | | | where a sales tax applies, and your business has a |
| services are taxable, the tax rate, and the difference in | | | | physical presence in that state, you must collect the |
| taxes if you are selling to individuals in different parts | | | | sales tax from that buyer. |
| of your state. You must charge sales tax to your client | | | | Similarly, if you have any location, facility, employee, call |
| because you are selling products and providing | | | | center, address, or even one independent sales person |
| services to them. | | | | in a state than you have to collect taxes in that state. |
| Generally, for sales tax collection, you must get a | | | | If your business changes its organizational structure |
| license from your state. On each taxable transaction, | | | | (for example, from a sole proprietorship to a |
| you calculate the applicable sales tax, collect it from | | | | corporation, a limited liability company, or a partnership), |
| the buyer, keep tax records, and then file a tax return | | | | the new organization must register as a sales vendor |
| and pay the taxes to your state. You'll pay monthly, | | | | and obtain a new reseller certificate for the new |
| quarterly, or annually, depending on your level of sales. | | | | business before you begin operating under the new |
| Similarly same rules apply for Internet sales and | | | | organizational structure. You must also file a final return |
| catalog sales: You have to charge and collect sales | | | | for your existing business and surrender the sales tax |
| tax when you deliver the product to a state in which | | | | permit or reseller permit that was issued to the |
| you have a "physical presence." | | | | previous business. |
| When you sell products or services over the Internet, | | | | |