Supreme Court - states can require online sellers to collect sales tax

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    Supreme Court - states can require online sellers to collect sales tax

    Supreme Court - states can require online sellers to collect sales tax


    Posted: 21 Jun 2018

    The Supreme Court on Thursday upheld a South Dakota law requiring certain out-of-state retailers, including those that operate remotely online, to collect its sales tax.

    In a 5-4 ruling, the court overturned a 1992 court precedent barring states from requiring businesses that have no physical presence in the state to collect their sales taxes.

    Delivering the opinion of the court, Justice Anthony Kennedy said the physical presence rule in that former case, known as Quill Corp. v. North Dakota, is unsound and incorrect.

    Kennedy said Quill created a tax shelter for businesses that decide to limit their physical presence and still sell their goods and services to a state’s consumers — something, he said, that has become easier and more prevalent as technology has advanced...


    Read more: http://thehill.com/policy/finance/39...sales-tax-case
    Brink's Avatar Posted By: Brink
    21 Jun 2018


  1. Posts : 1,099
    Win 10 pro Upgraded from 8.1
       #1

    it was good for us while it lasted, but I have to agree that online sales should pay local taxes, I sure don't want to be their tax guy, filing State and local taxes in 50 states monthly or even quarterly. this may bring back some of our lost local stores?
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  2. Posts : 2,068
    Windows 10 Pro
       #2

    I'm for it. I used to spend a few hours figuring out the tax from my Amazon and NewEgg purchases to report to the State of Michigan at tax time. Now that Amazon charges tax on many things, hasn't changed my shopping habits whatsoever.
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  3. Posts : 1,020
    Windows 10 Pro 20H2 19042.572
       #3

    So the question still remains, How are the states going to collect these taxes ? The only way they can do it is if the vendor is forced to collect the $ and then sends it to the states in question. What do the vendors do with states that Don't have any Sales TAX ?
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  4. Posts : 1,099
    Win 10 pro Upgraded from 8.1
       #4

    I believe that is what the SC decided, all online stores will now have to collect and file sales taxes in all the states they do business in. Before only the stores that have a storefront business in a state had to collect and file sales taxes. This only hurts the smaller businesses as the larger businesses already have accounting dept to handle the tax filings. Mom and Pop are going to spend a lot of time each month or Quater depending on which states there selling into.
    States that don't have a sales tax also won't have an entity to file sales tax with either. For a small business, Quickbooks can sort it all out for you. and actually, file the forms and payments for you.

    Where it will get really squirrelly is if they're required to also file County and City taxes! Oh yea AI will take care of it all for BB
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  5. Posts : 14,007
    Win10 Pro and Home, Win11 Pro and Home, Win7, Linux Mint
       #5

    SCOTUS = Supreme Court of the United States

    There's still 2 or 3 states that don't have Sales Taxes, Montana is one, Alaska is another. There may be some local and county tax collection.
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  6. Posts : 1,481
    W10 22H2 19045.3031
       #6

    "Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming have no income tax

    So what about purchases from overseas?

    Most military exchanges do not charge any tax regardless what state they are in.
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  7. Posts : 4,453
    Win 11 Pro 22000.708
       #7

    Earlier this year, Newegg ratted me out to my home state (Connecticut). CT billed me for tax plus interest on purchases I made several years ago. They waived penalties if I paid it immediately. Which I did.

    The new SCOTUS decision supposedly won't be retroactive. Maybe I should have waited. However, CT raised their income tax a few years ago mid-year, and made it retroactive to the beginning of the year. Which meant that the taxes were much higher for the remainder of the year to catch up. If I had been living hand-to-mouth while still making enough income to pay significant tax, that would have been a real bummer.

    I regard paying sales tax for online purchases as reasonable. It's not something I'm willing to keep track of myself.

    I wonder how this will be handled in areas with state and local sales taxes. In my home town in upstate NY, if I recall correctly, the state sales tax was 5%, but there was a local tax of 3% on top of that. I guess that there may be a real boon to business software developers, if every online business has to charge sales tax (by Zip code?) and distribute the funds properly.

    Maybe I'm the only customer that Newegg has lost over this. I think that they deserve special treatment for being the first major online retailer to roll over that way, even though the act itself wasn't wrong.
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  8. Posts : 1,099
    Win 10 pro Upgraded from 8.1
       #8

    bobkn said:
    Earlier this year, Newegg ratted me out to my home state (Connecticut). CT billed me for tax plus interest on purchases I made several years ago. They waived penalties if I paid it immediately. Which I did.

    The new SCOTUS decision supposedly won't be retroactive. Maybe I should have waited. However, CT raised their income tax a few years ago mid-year, and made it retroactive to the beginning of the year. Which meant that the taxes were much higher for the remainder of the year to catch up. If I had been living hand-to-mouth while still making enough income to pay significant tax, that would have been a real bummer.

    I regard paying sales tax for online purchases as reasonable. It's not something I'm willing to keep track of myself.

    I wonder how this will be handled in areas with state and local sales taxes. In my home town in upstate NY, if I recall correctly, the state sales tax was 5%, but there was a local tax of 3% on top of that. I guess that there may be a real boon to business software developers, if every online business has to charge sales tax (by Zip code?) and distribute the funds properly.

    Maybe I'm the only customer that Newegg has lost over this. I think that they deserve special treatment for being the first major online retailer to roll over that way, even though the act itself wasn't wrong.
    Well, actually Newegg sent me a notification of my purchased for 2017. So far I'm not sure how Louisiana is going to handle this. It seems that Amazon started collecting taxes around the 1st of the year.

    In this state as a retailer I have to file State and Parrish Taxes and then in the Parrish tax form included city taxes and special taxes like major shopping centers area pay a higher percentage. Sounds like a real nightmare for small businesses
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  9. Posts : 14,007
    Win10 Pro and Home, Win11 Pro and Home, Win7, Linux Mint
       #9

    Next step in collecting taxes probably will be state border crossings where purchases in a non-taxing state like Montana that are transported into a taxing state like Idaho will be assessed a User tax. If that succeeds next will be counties then cities, etc. It will never end.
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