A little light reading on Ebay tax collection.....so simple any Einstein can do it.
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Sellers' tax responsibilities
You are responsible for paying all fees and taxes associated with using eBay as an eBay seller. For more information on eBay's tax policy and your obligations, see our
Tax policy and
User Agreement.
Your tax-related responsibilities may include:
- Paying sales tax on eBay sales
- Paying income tax on eBay sales
- Informing overseas buyers about import charges
The
Supreme Court ruled in favor of South Dakota - opens in new window or tab in June 2018, which removed the requirement that certain retailers have a physical presence in a state in order for that state to impose sales tax obligations on retailers. Regardless of where you're physically located, if you do business in certain states, those states may require you to collect applicable taxes on your transactions.
For more information on these new tax requirements, we recommend that you consult with your tax advisor. If you do not have a tax advisor, you may want to reach out to
Avalara - opens in new window or tab and/or
TaxJar - opens in new window or tab.
Charging sales tax on eBay sales
If you're required to charge sales tax, you can set up a tax table and apply it to your listings. We'll then add the tax to the buyer's total at checkout. You're responsible for paying the sales tax to the appropriate authority.
Contact a tax professional to determine whether you need to charge sales tax on your eBay sales, or if you have questions about any other taxes. We can't provide tax advice or guarantee that our sales tax features meet all tax requirements.
Setting up a tax table
You can specify a sales tax rate for each US state in which you're required to charge sales tax. You can also charge tax on shipping and handling, if it's required by law.
Buyers see your tax rates on the listing page. Once they confirm their shipping address at checkout, we automatically calculate the sales tax amount and add it to their order total.
Here's how to set up your tax table:
- Go to Site Preferences - opens in new window or tab in the Account section of My eBay.
- In the Payments from buyers section, select Show.
- Select Edit in the Use sales tax table section.
- Fill in the sales tax rate for any state where you want to charge sales tax. If you're also required to tax shipping and handling in that state, select the Also charge sales tax on S&H check box.
- Select Save.
Important things to keep in mind when setting up a tax table:
- When you list your item you need to indicate that you charge sales tax in the listing form and associate your tax table with the listing.
- Changes that you make to your tax table won't be reflected in your live listings. You will need to revise any current active listings in order for your tax table changes to apply to those listings. Listing created after you have saved your tax table changes will reflect your tax table updates.
Once you've created your tax table, you need to specify in your listing that you are charging sales tax. Here's how:
- On the listing form, check the box beside Charge sales tax according to the sales tax table.
- You can open and make changes to your tax table by selecting View sales tax table.
- Complete your listing and select Preview listing or Save and continue later.
eBay sales tax collection
Based on applicable tax laws, eBay will calculate, collect, and remit sales tax on behalf of sellers for items shipped to customers in the following states:
State
Effective Date
Additional Information
Alabama
July 1, 2019
Alabama - opens in new window or tab
The State of Alabama has a program for simplified sellers use tax (SSUT) under Statute § 40-23-192. eBay has collected simplified sellers use tax on taxable transactions delivered into Alabama and the tax of flat eight percent (8%) will be remitted on the customer's behalf to the Alabama Department of Revenue.
eBay Inc. - SSUT Account Number: SSU-R010250382
Arizona
October 1, 2019
Arizona - opens in new window or tab
Arkansas
July 1, 2019
Arkansas - opens in new window or tab
California
October 1, 2019
Please contact the
Department of Tax and Fee Administration - opens in new window or tab for further information.
Colorado
October 1, 2019
Colorado - opens in new window or tab
Connecticut
April 1, 2019
Connecticut - opens in new window or tab
eBay Inc. is registered with DRS to collect Connecticut sales tax and will collect sales tax on all taxable Connecticut sales facilitated on our site.
District of Columbia
May 1, 2019
District of Columbia - opens in new window or tab
Hawaii
January 1, 2020
Please contact the
Hawaii Department of Taxation - opens in new window or tab for further information.
Idaho
June 1, 2019
Idaho - opens in new window or tab
Illinois
January 1, 2020
Illinois - opens in new window or tab
Indiana
July 1, 2019
Please contact the
Department of Revenue - opens in new window or tab for further information.
Iowa
February 1, 2019
Iowa - opens in new window or tab
Kentucky
July 1, 2019
Kentucky - opens in new window or tab
Maine
October 1, 2019
Please contact the
Maine Revenue Services - opens in new window or tab for further information.
Maryland
October 1, 2019
Please contact the
Comptroller of Maryland - opens in new window or tab for further information.
Massachusetts
October 1, 2019
Please contact the
Massachusetts - opens in new window or tab for further information.
Minnesota
January 1, 2019
Minnesota - opens in new window or tab
Small business exemption - Minnesota has enacted a small business exemption for out of state unregistered sellers whose taxable retail sales into Minnesota are less than $10,000 in the previous 12-month period. These sellers are not subject to the Minnesota marketplace tax laws, and eBay will not be collecting sales tax on these transactions.
Nebraska
May 1, 2019
Nebraska - opens in new window or tab
Nevada
October 1, 2019
Please contact the
Nevada Department of Taxation - opens in new window or tab for further information.
New Jersey
May 1, 2019
New Jersey - opens in new window or tab
New Mexico
July 1, 2019
Please contact the
Taxation and Revenue Department - opens in new window or tab for further information.
New York
June 1, 2019
New York - opens in new window or tab
eBay Inc. is a registered New York State sales tax vendor and will collect sales tax on all taxable sales of tangible personal property that it facilitates for delivery to a New York State address.
North Dakota
October 1, 2019
Please contact the
Office of State Tax Commissioner - opens in new window or tab for further information.
Ohio
September 1, 2019
Please contact the
Ohio Department of Taxation for further information.
Oklahoma
July 1, 2019
Oklahoma - opens in new window or tab
Pennsylvania
July 1, 2019
Pennsylvania - opens in new window or tab
Rhode Island
July 1, 2019
Rhode Island - opens in new window or tab
South Carolina
October 1, 2019
South Carolina - opens in new window or tab
South Dakota
July 1, 2019
South Dakota - opens in new window or tab
Texas
October 1, 2019
Please contact the
Texas Comptroller of Public Accounts - opens in new window or tab for further information.
Utah
October 1, 2019
Please contact the
State Tax Commission - opens in new window or tab for further information.
Vermont
July 1, 2019
Vermont - opens in new window or tab
Virginia
July 1, 2019
Virginia - opens in new window or tab
Washington
January 1, 2019
Washington - opens in new window or tab
West Virginia
July 1, 2019
West Virginia - opens in new window or tab
Wisconsin
January 1, 2020
Wisconsin - opens in new window or tab
Wyoming
July 1, 2019
Wyoming - opens in new window or tab
Prior to the effective date, you should continue to collect and remit tax in these states if required. Additional states will be added to this list at a later date.
Once eBay starts to collect tax in the above states, no action is required on your part, and there will be no charges or fees for eBay automatically calculating, collecting and remitting sales tax. The collection process will apply to all sales, whether the seller is located in or outside of the United States.
When a buyer purchases an item on eBay, and the ship to address is one of the above states, eBay will calculate and add the applicable sales tax at checkout. The buyer will pay both the cost of the item along with the sales tax. eBay will collect and remit the tax.
Sellers are not able to opt out of selling items into the states listed above or opt out of eBay automatically collecting sales tax.
1099-K forms and income tax on eBay sales
By law, sellers have to declare and pay taxes on income earned from eBay sales. We recommend checking with a tax advisor to understand your responsibilities.
If you’re a managed payments seller, and have more than 200 transactions and generate more than $20,000 in sales in a calendar year, you'll receive a Form 1099-K from eBay. This information will also be reported to the IRS and your state tax authority, where applicable.
Only managed payments sellers will be eligible to receive 1099-K forms from eBay. If PayPal or another authorized payment service processed any of your eBay payments during the calendar year, you may receive a separate form from them if your transactions meet the thresholds.
Sellers in Massachusetts and Vermont
Massachusetts and Vermont use a threshold of $600 and don’t have a transaction threshold, so if you're a managed payments seller, and reside in one of these states, you’ll get a Form 1099-K from eBay if your gross payments equals or exceeds $600, irrespective of the number of payments you receive.
We’ll also report this amount to the Massachusetts or Vermont tax authority as applicable. You should note that your gross payments won't be reported to the IRS unless you exceed $20,000 in gross payments and have more than 200 transactions.
For more information, read our article on
eBay and Form 1099-K.
