Charge Sales Tax?

[crochetrae]

I've never sold at a craft fair, but have been asked to do so this fall.  Do I need to get a tax ID # and charge sales tax?  I've always reported cash sales on my income tax, but I don't know about this other.  What are the rules about that?  Also, do most of you guys take credit cards?  That would be such a hassle.

[FrLopLady]

Might depend on your state.  Some craft fairs would require the info on their application.  If you want to be seen as a true business, yes do the tax hassle.  I take credit cards using GoPayments from Intuit, but I know many that use Square Up as well

[Real Deal]

Here in NY State, the large (and some small) craft shows require you have a tax ID. You get this from your state's Dept of Taxation and Finance. Once you are registered with the state, they will send you instructions on how often you have to fill out reports for them and turn in the tax money.

[RoseRed]

In Florida, I had to register as a business before I could register with the state to collect sales tax.

[crochetrae]

Wow, I had no idea.  Sounds unanimous. Thanks for the info.

[wheat]

Each state has its own rules and regulations.  You did not say if the show you intend to do is in the same state as your home.

 

The show promoter should be able to assist you with applicable law, but you will need to do the work of getting legit.

 

If the show is in another state, then you will likely need to register and report in that state as well. 

 

Most if not all states do have an option for those from another state. It is a "one time" form so that you pay them for the sales from that show only. 

 

Some states (I seem to remember several southern states) where if you sold at more than 3 shows in their state per year, you had to do the whole registration process.

 

Again the show promoter should be able to give you some guidance both on tax and any other licensing that will be required (often times a regular or single show trader's license may be required)

 

You will also need to find out which of the items you intend to sell are taxable.  In some states, clothing under a certain dollar amount is not subject to sales tax (but sales must be reported)  In others, supplies to make clothes ALSO are not but might be in the case of say certain fancy yarns intended for scarves.

 

And for goodness sake, if the show is in New Jersey - find out and follow every rule to the letter - NJ sales tax investigators are not only known to be merciless and unforgiving of ignorance, but I have seen them make the IRS look like amateurs. Even when you follow the rules, they are such a hassle that I stopped doing one of my most lucrative venues because it was just too annoying to deal with them.

[wheat]

BTW, 

 

I never say I  CHARGE Sales Tax,

 

when asked my answer is that

 

We do not CHARGE Sales Tax, we are, however, required by law to be an unpaid TAX COLLECTOR for the State of (fill in the blank) 

 

Don't forget to build the cost of your time and energy into the price to cover your overhead for proper preparation of appropriate business reporting.

 

Whatever you decide,  I would wish you great success at your event.