If you need help with sales tax & business laws for 33 other states in the USA, please see here:

Don’t see your state? Leave a comment on that post and I’ll update it as soon as possible for you.

New York State’s Online Permit Assistance and Licensing website
(also known as OPAL)
See the “Click here to start” link for a questionnaire of what types of issues your business may be involved with, and it will present you with filing requirements and advisory sheets tailored to your business needs.

The hardest part of using this cool tool is the first step–picking your business type. The design for this section is really poor, and after a lot of clicking I settled on Craft/Hobby Vendor for my business:

NYS Sales Tax
In NY you must register with the Dept of Revenue to collect sales tax for both your on-line sales and for live events *before* you start to sell. See the Permits, licenses, and registrations link here:

If you didn’t register before you started to sell, see here:

Other Requirements
You should also contact your county & city offices to be sure you know what local business laws there might be in your area. This should help:

More on starting up your NY or other US-State based business:

Also see the links on the right for more info on the IRS, Sales Tax and NY business, including:

In New York your Certificate of Authority to Collect Sales Tax is needed before you can collect sales tax from in-state customers.

If you sell taxable items from New York State (NYS) should have one regardless of how little you sell, or whether or not you consider yourself just a hobby and not a business. You then remit the sales tax to NYS according to the schedule NYS gives you. It’s quarterly the first year, then the frequency is determined by the State based on how much you collected the first year.

Your Certificate of Authority to Collect Sales Tax is also what gives you the ability to purchase certain goods without paying sales tax. You can buy as a reseller, buy supplies and tools for use in producing tangible personal property that you will sell and buy some promotional materials without paying sales tax.

To purchase eligible items without paying sales tax, you need to fill out and present the proper form–see below. Most stores will keep a copy of your filled out form on hand if you will be buying from them regularly, others want a copy for each purchase.

You should never photocopy or otherwise reproduce your Certificate of Authority to Collect Sales Tax.

5. Employer Identification Number:

Your business may not be required to get a:

Taxpayer Identification Number (also referred to as TIN),
Employer Identification Number, EIN, or
Federal Taxpayer Identification Number, FTIN.

These all refer to the same thing, I don’t know why it goes by so many names!

You’ll need to check the IRS website to see if you should get one–there’s a link in our “The IRS Website–Links for Businesses” post. While we didn’t need to get one, we chose to, see that post for details.

If you have an EIN and you register with NY to collect sales tax, your NY Sales Tax ID Number will be the same as your EIN. Just having an EIN does **NOT** mean you are allowed to collect NY sales tax, you must apply for a “Certificate of Authority to Collect Sales Tax” before you are permitted by the state to collect sales tax. (Links to apply for your NYS Certificate of Authority, EIN and other business info will be posted shortly.)

6. Certificate of Authority:

Having a NY Tax ID means you have a NY State “Certificate of Authority” to collect NY sales tax. (Links to apply for your NYS Certificate of Authority, EIN and other business info will be posted shortly.)

7. Collect Sales Tax from Customers, then Remit it to the State

Once you have your NYCertificate of Authority, you collect sales tax from your customers who have packages shipped to New York addresses, and report and pay the sales tax you collect to NYS.

The New York State Department of Taxation & Finance sends you the paperwork once you have been approved to collect sales tax with instructions for collecting from your customers and remitting the money you collect to NYS.

For us, the first year we were required to file quarterly. After the first year, the state assessed our business to be small enough that now we only file once a year. Sales tax is completely separate from your annual state and federal income taxes.

I’ve written up some info that I’ve shared across several lists/threads over time. This information doesn’t cover all areas of sales tax and when/how to apply it. This is based on my knowledge of NY State business info, and I advise you to re-check the info with NYS publications and employees yourself.

Please-please-please–Always double check info you get on-line with the authority in charge of dealing with it in real life.

Each state has its own regulations–posts for other states with limited info coming soon!

Helpful NYS document with the basics for NY Sales Tax–it’s a PDF file:

More NYS documents: Sales Tax Publications

Some New York Sales Tax info:

1. You can’t use Paypal’s sales tax calculator for NY Sales Tax:

NY has more than 10 different tax rates across the state based on our 60+ counties that can only be determined by using the buyer’s street address AND zip code, which means you can’t set up Paypal to accurately charge NY sales tax.

Even if you put all the 5 digit zip codes for NY in the sales tax function on Paypal, it will not charge sales tax appropriately for NYers because the sales tax rates are determined by political zones (counties) which are not defined by 5 digit zip codes since 5 digit zip codes can cross county lines–you’d need the full 9 digit zip code to determine the right zone. (You cannot put 9 digit zip codes in Paypal, so even if you wanted to spend a week doing it, you can’t.)

You can have two houses next to each other in the same zip code and each has a different sales tax rate because they fall under different political jurisdictions.

To find the tax for a specific New York address use this on-line form:

http://www8.tax.ny.gov/STLR/stlrHome

Don’t forget to make sure your items fall under the general sales tax rate by checking the blue “Limitations on Use” link on that page. Clothing, food items and other products may not get the same rate as everything else gets at a particular location.

Limitations on Use: http://www.tax.state.ny.us/e-services/stlr/stlrinfo.htm

2. In-Person Sales–Use the Local Sales Tax Rate:

For in-person sales, you must charge the state and local tax for the location of the sale–for example, when you are at a show you charge the rate based on the street address of the show.

In-person rate is based on the location where the item is sold.

3. Shipping Items You Sell–NY Uses Destination-based Sales Tax:

If you sell through the internet, by mail or by phone, the location is the address to which the item is shipped regardless of the location of the buyer or seller.

This means that collecting the tax based on YOUR location is not correct unless you happen to live in a zone with the same tax rate as the delivery address.

If the buyer lives outside NY, but is having the item shipped to NY, you still must charge sales tax based on where the item is being shipped.

See this FAQ page from the NYS website:

NYS website: Sales tax based on “point of delivery”.

4. There is Sales Tax on Shipping if items are taxable:

NY sales tax is also applied to shipping charges for taxable items, unless you have a third party ship your items, in which case they charge you tax on their service (so you don’t charge it to your buyer). For example, a pack and ship store will charge you sales tax on their services, and you pass that cost on to your buyer in the total cost; you don’t re-tax that amount since sales tax has already been paid on it.

Source: http://nystax….sales-tax-on-shipping-and-handling

It gets more complicated if only some of the goods in the transaction are taxable–see here for full details:

Technical Services Bureau TSB-M-92 (2)S–PDF

Continued here:
New York Sales Tax–continued

Go To Great Panes, Kathryn Maloney ©2010
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