American State Sales Tax

[Romanof54]

Hello,

Searched the forum for threads on American state sales tax and nothing came up. So, here's my situation.

My store is a little over a year old and only working at it part time. No sales during this time until I recently had one. When I used the Alidropship plugin to place the order I found that sales tax was being charged. I have a state business license/permit so I'm sales tax exempt on what I purchase. I collect sale tax only in certain cases but not required to collect sales tax for almost all sales. I also have a IRS Tax Number so I'm U.S. tax exempt as a wholesale business.

A chat with Aliexpress and a follow-up email indicates that for each dropship purchase I make, I'll need to submit a Aliexpress Statement of Buyer on Sales Tax Exempt Purchase. Well this isn't going to work for me and it looks like I'll be charging sales tax to all my customers. Does anyone have a suggestion on how to set up sales tax collection for each U.S. state? To do this manually is very time consuming. I'm hoping there's a plugin or some automated way of adding U.S. sales tax.

Thank you.

This is an update. I found what I was looking for. The Alidropship plugin has a tax setting. I just didn't have it enabled. Working on another store using Woocommerce and it also has a tax setting. I'm all good with my issue.

 

[Direct Webstore]

Does anyone have a suggestion on how to set up sales tax collection for each U.S. state?

The popular thing to do with most people is to register their business or LLC in one of the sales-tax-free states (Delaware etc) and then they don't have to worry about that problem at all. This has been discussed in this forum a few times and you can also find more info in the Blogs section. There is at least article there on it, from memory.

I have a state business license/permit so I'm sales tax exempt on what I purchase.

The Alidropship plugin has a tax setting.

That is for sales tax charged to your customers for products bought from your store, not for any sales tax on items you order on Aliexpress to dropship to your customers. You have to absorb that cost in your overall profit. Consider it just one of the expenses of running a dropshipping business.

 

[P3DR0RTI2]

I think you are wrong about the way taxes are treated in the United States, I advise you to consult with an accountant or investigate very well or you may have problems.... If you have a registered business you cannot charge taxes to your customers simply because Aliexpress charges them, your business charges must be done according to the nexus and responsibility of your company with the Federal and State Government.... The money collected for taxes is the property of the Government not the seller.

If they collect taxes as a way to recover the tax collected by Aliexpress they are committing a crime and can have serious penalties.

In summary the best way to deal with the tax issue is to collect and pay tax only in the States where you have nexus, to recover the tax collected by Aliexpress you can request a refund as long as you have a valid reseller certificate, finally and if you do not want to have this administrative wear and tear, the easiest thing to do is to assume as a loss the payment of sales tax and only charge your customers the corresponding tax where you have nexus.

 

[zeniaspell]

I also think you might be wrong about the taxes. Taxes aren't treated the way you said. And P3DR0RTI2 has a good point saying that you have to contact an accountant to explain to you how the tax system is treated in general. If it's the way you have said, they are indeed committing a crime, and that's something that should be investigated on a global level. If you want to understand how the tax system works, start with the mortgages. The situation is pretty similar. You can call Mortgage Advice York, and he will explain to you a lot of helpful things.

 

[Ushuaya]

I am happy that you solved your issue, but I am worried that you didn't take any lessons out of it. Sometimes ordering online can e something dangerous, and you must be prepared if anything happens. When my family has to order some expensive collets, and they are afraid if anything could happen, I remind them about shipping services; salehoo review is the one that I have been using for a while. That verifies not only your collet but also the seller and gives you a lot of useful information you would need in case of anything,