I sold a 5.05 carat loose diamond for $5,999.00 to a customer and she told me she had a sellers permit and gave me a copy. I did not charge her taxes, did I do the correct thing and do I have to claim that when I pay my taxes?
2007-04-06 00:04:55 · 5 answers · asked by Emeralds Diamond Store 1 in Business & Finance ➔ Taxes ➔ United States
They MUST BE Tax Exempt for this to happen as you HAVE to Report the Sale at the end of the year at TAX time. They will have a Tax Exempt Number they have to GIVE you for your Records.
2007-04-06 00:09:17 · answer #1 · answered by Ex Head 6 · 0⤊ 0⤋
Yes, keep the copy she gave you. The documentation required for a tax exempt sale varies from state to state, but a copy of the sellers permit should be sufficient if taken in good faith (you have no reason to believe the purchase was for personal use and not for resale).
2007-04-07 10:36:09 · answer #2 · answered by Amy F 3 · 0⤊ 0⤋
If you are selling goods, you must collect and render sales taxes on taxable sales. If you are buying for resale, the vendor will not charge you sales tax on those purchases. They will need your tax number and most want a copy of your certificate. Don't waste time and $$$ shipping around to avoid paying. The excess shipping charges would probably be more than the taxes unless you're selling high-cost goods. And legally if the sale is taxable you'll be expected to pay the use tax on it when it's shipped to you. Most states don't bother going after ordinary citizens for that, but they will go after a retailer who has a tax cert for collecting sales taxes.
2016-05-18 03:37:27 · answer #3 · answered by dionna 3 · 0⤊ 0⤋
What you have to claim on your taxes is the income you collected on the sale -
$ 5,999.00, on your Schedule C, assuming of course you are self-employed.
The mistake you did make was to accept a "sellers permit". What you should have collected from your customer is a "resale certificate". Resale certificates
are issued if the personal property you are selling will be resold.
If you sell property for resale, you must obtain a resale certificate. Otherwise,
if you sell to someone who is the "ultimate consumer", then you must charge them sales tax.
2007-04-06 02:53:24 · answer #4 · answered by bold4bs 4 · 0⤊ 0⤋
Sales you make for RESALE customers do not require you to collect sales taxes. You need to keep a copy of their sales tax paperwork as proof.
You must claim that income on your income tax, of course.
2007-04-06 00:20:28 · answer #5 · answered by Bostonian In MO 7 · 0⤊ 0⤋