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Mrs. Peel

Sales Tax on Internet Sales...?

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I don't know what the status of this is... perhaps it passed already? I know there's a way to look it up and I'll try to update this with more information as soon as I locate it.

But the proposal was to add NJ Sales Tax to internet purchases in several categories - for "facilitators" like Amazon, and apparently, for any company doing more than $200K of sales in NJ.

I mention it for 2 reasons: many of us use Amazon for firearms accessories (among other purchases) so this will definitely add expenses there, and 2) this might also impact Internet ammo purchases. 200K doesn't sound like a lot of sales to me... so I'm assuming some of the bigget ammo suppliers we order from may be impacted as well.

Link to article: http://www.roi-nj.com/2018/09/26/politics/bill-taking-advantage-of-new-internet-sales-tax-rules-set-for-votes-in-both-houses-Thursday/

Update: maybe I'm not very deft at using that NJ Legislature website? I cannot find the darn thing... tried keyword search AND category search. Yet I've seen several articles about it, so I know it's brewing. If someone else can find it, please post it here. Thx!

 

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17 minutes ago, MartyZ said:

Amazon has been charging sales tax in NJ for quite some time, because they have a fulfillment center in Edison.

Thank you! I probably never even noticed.

But, ammo suppliers? Will it impact some of them? 

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http://nj1015.com/more-new-nj-taxes-going-into-effect-right-now/?utm_source=sailthru&utm_medium=referral&utm_campaign=newsletter_14616168

 

INTERNET SALES TAX:

Following a Supreme Court ruling, New Jersey is expected to take in $188 million on all internet sales. Previously, the tax could be collected from companies that had a physical presence in the state. Nine other states will also begin collecting on internet sales on Monday.

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1 hour ago, pjd832 said:

Wow ... where will it end?…next they’ll be collecting tax on meals or fuel purchased outside the state ...same principle

They’re trying to use a “Sales” tax as a VAT/Purchase tax. Getting it both ways. 

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Bear in mind, even  when you were not charged sales tax in the past, you were still required to declare those purchases and pay the  sales tax on your NJ State tax return. And I for one, did so.

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I wonder how exactly they are going to collect it and what will the penalties be for non compliance -- How the gonna enforce it? 

 

the system for small business in the state makes me an unpaid tax collector, I have to calculate, collect, fill out all the paperwork, and pay the state all on my time -- no compensation from them at all and if I'm late they fine me

 

 

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1 hour ago, oldguysrule649 said:

Bear in mind, even  when you were not charged sales tax in the past, you were still required to declare those purchases and pay the  sales tax on your NJ State tax return. And I for one, did so.

So you would save all your receipts from innocuous purchases throughout the year like order shaving razor refills online and claim that $15 purchase on your income tax?

 

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8 hours ago, MartyZ said:

Amazon has been charging sales tax in NJ for quite some time, because they have a fulfillment center in Edison.

They have many already..

Edison, Avenel, Cranbury...

They have been charging sales tax for quite a while on AMAZON FULFILLED orders, not necessarily 3rd party purchases.

200k in sales isnt much, realistically, as that isnt profit, its sales. Most big sites like optics planet will likely be hitting us with sales tax; i know i ordered from magblocks and optics planet last night and both hit me with sales tax.

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6 hours ago, pjd832 said:

So you would save all your receipts from innocuous purchases throughout the year like order shaving razor refills online and claim that $15 purchase on your income tax?

 

I was merely pointing out that, in theory, the OP’s question is somewhat mute given the tax law. Compliance with it no doubt has been lacking.  I try to make a good faith effort to identify and declare significant purchases.  

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4 minutes ago, oldguysrule649 said:

I was merely pointing out that, in theory, the OP’s question is somewhat mute given the tax law. Compliance with it no doubt has been lacking.  I try to make a good faith effort to identify and declare significant purchases.  

I assumed that you were referring to larger purchases, and was pointing out the ridiculousness of the concept and that a state like New Jersey will not stop until it drives everyone not living on the dole out. 

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3 hours ago, oldguysrule649 said:

Compliance with it no doubt has been lacking.  I try to make a good faith effort to identify and declare significant purchases.  

The issue with that is reporting it on your Schedule A. You have the option of either reporting your state income tax you paid or the state sales tax you paid, but you can't do both. So, how do you report it?

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5 hours ago, Sniper22 said:

The issue with that is reporting it on your Schedule A. You have the option of either reporting your state income tax you paid or the state sales tax you paid, but you can't do both. So, how do you report it?

IIRC there is a separate line to pay your tax on out of state purchases.

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2 hours ago, mossburger said:

I've been paying sales tax on Amazon purchases for years now...this is nothing new? 

I ONLY JUST noticed sales tax through amazon last year. weirdly, it wasn't charged on everything i bought. i think it matters if it's fulfilled through them or another vendor?

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On 10/3/2018 at 4:12 PM, 1LtCAP said:

I ONLY JUST noticed sales tax through amazon last year. weirdly, it wasn't charged on everything i bought. i think it matters if it's fulfilled through them or another vendor?

It was only applied for items fulfilled by amazon. If it shipped form a 3rd party vendor, you didn't get charged. 

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There's more to this than meets the eye.

as a seller on ebay, how does one send the tax money to the state the buyer lives in?

eBay would have to take the tax upon the sale and distribute it accordingly.

This is a NIGHTMARE for them with a lot of costs, not that I feel sorry for these scumbags, but it will come at a cost to the sellers hence the buyers to cover their admin costs.

thats why they lobbied hard against it.

 

 

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I'm an ebay seller. Small time, like under $50k/year. My father does more than that in a month, i just do it as a side gig.
I Don't think this applies for us "Smaller" sellers due to the amounts most states will require as the cutoff (IE NJ's 200k). We both already collect NJ Sales tax, naturally... that's already a PITA and i am admittedly regularly late with filing, even though we're talking about 30$ in collected NJ Sales tax most quarters.. NJ customers stay away just because the sales tax makes us more expensive than competitors, usually.
If i have to collect for 12 states, i'll just sell on a personal account and not collect at all...

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On 10/3/2018 at 4:12 PM, 1LtCAP said:

I ONLY JUST noticed sales tax through amazon last year. weirdly, it wasn't charged on everything i bought. i think it matters if it's fulfilled through them or another vendor?

It used to be mandatory for a company to collect sales tax on internet sales only if the buyer lived in a state where the seller, i.e. Amazon, had a physical property in the same state.  Not necessarily a retail store front, just a property like a warehouse, admin office, port-o-pot, etc.  So we got taxed by Amazon because they have facility in NJ.

Last year, the Amazon company decided to start charging state sales tax to all buyers in a state that imposed a sales tax, even if there was no Amazon facility in that state.  I read an article that Amazon CEOs believes that if all companies did this for all internet sales, the money generated toward government taxes would help increase government funding by 30 billion and the government could then reduce personal income tax on individuals and businesses.  

Amazon (and other companies) CEOs actually lobbied congress to enact the law.  Congress put together a subcommittee to study it.  We all know the government will gladly take the new tax revenue and will not reduce income tax on people or businesses in return.

   

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I work in Delaware and there are Amazon facilities there, but there is no sales tax in Delaware.  Amazon also has these drop boxes where you can have your package delivered to the boxes.  You select the location, they deliver to the locker then they email you the locker number and digital code to open it.  There's one at a gas station near my job and I get packages sent there so I can pick it up on the way home from work.  Those purchases have no tax since the delivery location is in Delaware.  The lockers are not huge so they can't deliver larger items to it, but magazines, holsters and other smaller items fit and it makes me feel like I've achieved a small victory in my effort to evade the oppression of the PRNJ.

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39 minutes ago, Regular Guy said:

 the money generated toward government taxes would help increase government funding by 30 billion and the government could then reduce personal income tax on individuals and businesses.     

Ahhhhhahahahahhaha...

good one. 

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Just released this morning: (Notice Gov Bucky Beaver's smile as he passes on MORE Taxes!)

 

NJ Gov. Phil Murphy Signs 12 Bills Into Law, Including A New Tax

 

NJ Gov. Phil Murphy Signs 12 Bills Into Law, Including A New Tax

New Jersey Gov. Phil Murphy has signed 12 bills into law that could have a big impact on your life, including legislation that will impose a sales tax on online retail sales. The tax is supposed to take effect on Nov. 1.

The new law (A-4496) will require certain remote sellers and online marketplace businesses to collect and remit sales tax. 

Under the law, a seller must collect taxes if it does not have a physical presence in New Jersey but has revenue from sales in the state during the calendar year, or prior year, in excess of $100,000, according to lawmakers.

 
 
 

The same rule will apply to a seller with 200 or more separate transactions in the state during a calendar year or in the prior year.

The tax legislation, sponsored by Assemblymen John Burzichelli and Paul Moriarty, is intended to ensure a "level playing field" between brick-and-mortar businesses and online marketplace providers like Amazon. The lawmakers say it will also bring in needed revenue to the state.

"This will help provide parity among brick-and-mortar businesses and online marketplaces and provide the state with needed revenue," said Burzichelli, D-Cumberland/Gloucester/Salem). "Online marketplaces have made it easier for interstate and international commerce, allowing many businesses to circumvent state sales tax requirements. New Jersey based businesses have to abide by the sales and use tax law, and so should any company who does substantial business in the state."

New Jersey could gain between $216 million and $351 million as a result of this legislation — about 2 to 4 percent of total 2016 state and local government general sales and gross receipts tax revenues — according to the United States Government Accountability Office (GAO) study in November 2017.

Forty-five states and the District of Columbia levy taxes on the sale of goods and certain services, including those sold remotely, such as over the Internet, according to the lawmakers.

These provisions of the law reflect the recent decision of the United States Supreme Court in South Dakota v. Wayfair, Inc., in which the court determined that having a physical presence within a state was not a prerequisite for the collection of sales tax on purchases of tangible personal property.

In that case, the court held that imposing sales tax on a seller that delivers more than $100,000 worth of sales into a state or delivers 200 or more separate transactions into a state has a sufficient nexus with the state for the state to impose tax on the seller.

"The fact that they are not physically located in New Jersey should not exempt a business from sales tax and use requirements," said Moriarty, D- Camden/Gloucester. "These businesses should play by the same rules as other NJ businesses who pay property taxes, local taxes and make an investment in the communities they're in."

The bill was approved 43-35 by the Assembly and 23-14 by the Senate on Sept. 27.

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On 10/3/2018 at 10:58 AM, Sniper22 said:

The issue with that is reporting it on your Schedule A. You have the option of either reporting your state income tax you paid or the state sales tax you paid, but you can't do both. So, how do you report it?

This is not related to Fed Schedule A.  Rather, refer to NJ-1040 Line 45.  "USE TAX DUE ON INTERNET, MAIL-ORDER, OR OTHER OUT-OF-STATE PURCHASES".

 

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