Tax On Coins On Ebay?

Did you received that message from a potential buyer? Sales tax on ebay is automatically charged based on the buyer's state. Perhaps you have a coin listed in a category that is taxed (like coin supplies or something), and someone is asking that you list it in a coin category so that it won't be taxed in his state.

The information above could be confusing.

After the US Supreme Court decision in Wayfair vs. South Dakota, most states have changed their laws to follow the ruling.

Sales tax is due based on the BUYER'S location. The location of the SELLER is irrelevant. ebay as a marketplace is legally required to collect (and remit) (and register with the authorities in those states) sales tax once certain thresholds have been passed (100 transactions or $20K is common) (note that as an individual seller outside of ebay the same rules would apply).

Where it gets complex is that there are something over 10,000 tax jurisdictions in the US and what is / is not taxable varies. Usually at the state level, but there are county, city, and even localities that charge different rates or even what is taxable (if STATE law allows is).

In some states bullion coins / precious metals are not taxable, but numismatic coins are. All ebay has to go on is the category the seller listed in. I'm on the side that says they are doing the best they can, but it's not very good.

I have had to request collected taxes back from ebay a few times. First time it took a few days, second time it took over 2 months and they only did one of the 2 I reported. If I do a buy it now item, I will put it in the cart and if it charges tax, I will not purchase it. There are many other choices and you most always find one that is tax free. Just don't want to deal with trying to get it back from ebay anymore.

Interesting. Guess in mn I'm just used to expecting tax to he on everything. Have never even thought about it

You can use this link to upload a tax exemption certificate (charities, resellers, etc):

https://ocsnext.ebay.com/ocs/mudcwf?deptName=IST

RPT, that is great news! I am still waiting on my February purchase.

J Frederick, it is not an issue of tax exempt status for a charity, reseller, etc. ebay is illegally collecting tax on items that are NOT taxable in many states. It should not be the responsibility of the buyer to request a refund and then wait 3+ months. Most sellers are likely unaware this is occurring and many buyers don't realize they should not be taxed.

Is ebay submitting the inappropriately collected tax to the various states or keeping the money? How many people are now avoiding purchasing precious metals or numismatic products because of this? I, for one rarely purchase such products on ebay any longer.

Consider that ebay is collecting between 4-7% on these purchases.

For sure ebay is collecting and remitting taxes. The penalties for not doing that are enormous.

Because they're collecting and remitting, they also have to be the ones requesting the refund.

Last time I checked (Texas) to receive the refund as the buyer I have to have a notarized document from the person who collected and remitted the taxes to release them to me.