Paying sales tax, but not a business?

[bbailey]

From what I understand, if you sell a print, etc you owe the state sales tax on that sale. Makes sense. I have my own part-time computer business, so I understand the sales tax issues for businesses.

But how do you pay it if you are not in business? I don't plan on making any real money from photos, but once a year or so I have the opportunity to cover an event or take pictures that people will buy. Setting up a business wouldn't make sense for the off chance I sell something every now and then. Do I just go to the comptroller and set something up?

[CaptainTom]

I'm not a tax lawyer, but I did stay at a Holiday Inn Express once.

I believe the state considers you "in business" if you sell anything to someone else.
There are very few exemptions to collecting sales tax. The best "Holiday Inn" advice would be to file the forms with the state, collect the tax, and be safe.

You must obtain a sales tax permit if:
you are an individual, partnership, corporation, or organization engaged in business in Texas; AND
you are selling tangible personal property or providing taxable services in Texas to customers in Texas

[Michelle Allmon]

it doesn't cost anything to get a business license so even if you only do it a couple times a year it's no big deal. just means you need a smaller ledger... or shoebox.

[acesteward]

lol I need a bigger box for the receipts of all the stuff I buy lol

[texaswolflady]

From an accounting point of view........when I pay an invoice from a Texas Based vendor (you would be considered a vendor, especially if you are selling to companies) and the Texas Based vendor doesn't charge sales tax, I have to calculate that sales tax, pay it to The Texas State Comptroller, file a report with The State Comptroller of Texas and attach copies of the invoice(s) with that report.

Plus when I set up a new vendor to pay, I have them submit a W9 form before I release their first check, which has either their social security number or their TIN (taxpayer id number) on it. Based on how they complete the W9 and should they be paid over $600.00 in a year, then a 1099 is issued and sent to the vendor and also the IRS.

I have never followed up to see if the vendors who don't charge sales tax to see if The State Comptroller contacts them. I would suggest having all your paperwork lined up and all your "I"s dotted and "T"s crossed.

Sales tax can be very very sticky and if not sure, best to call and ask. But of course if you call back with the same question, you might get a different answer. Keep a record of who you talked to and when.

[boomerd35]

I've been through a few sales tax audits for companies I've worked for, and I've talked to tax consultants who used to be auditors for the state. I know that when a business is audited, and it's discovered that a vendor is not collecting sales tax as they should be, the State of Texas will use those companies as "leads" to conduct audits on those vendors. However, I seriously doubt that they would come after an individual who only makes a few sales a year. With that said, the ultimate person/company responsible for paying the sales tax is the end user of the product/service.

Troy T.

[bbailey]

Thanks for the info.

Just to clarify, I wasn't considering not paying the sales tax. I was just curious if I was required to go through getting a DBA, etc to do so since it would really just be hobby income. I may do it anyway since it is easy.

[acesteward]

It is pretty easy, a dba cost me $20 back in april in tarrant county, I think that it is different in each county not sure, buy you have to go to the county courthouse, some sub court houses will do it as well, but your dba is good for 15 or 20 years for that one time, not sure which amount of time. Your sales tax is free to sign up for and you can do it online, print out one paper sign it and mail it in. I signed up online, and didn't get around to printing and mailing out the form to be signed and they sent me a letter with the form to sign within 2 weeks of signing up online.

Easy as that.

[bbailey]

Ah, I forgot to post an update.

I went an got a DBA, I've done it before so it was no big deal. Then I went to the local comptroller's office. It turns out I don't need a separate taxpayer ID since I already have one for my part time computer business, and the photo biz would be at the same address. I just pay the sales tax under the existing ID#. Pretty simple. I was worried that I would have to mess with more paperwork but that was it.

[Shane]

Originally Posted by CaptainTom

I believe the state considers you "in business" if you sell anything to someone else.

Tom is exactly right - if you sell a print, you are "in business". See this thread for more details . . .

http://www.texasphotoforum.com/forum...ad.php?t=13628