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Discussion Starter #1
Okay, I won an ebay auction from a wisconsin seller. He sends me the invoice, which included sales tax at 5%. CA charges 7% and up, so I start wondering what's going on? I look at the auction again, and then I see he's charging that 5% for all 50 states and DC. I know that some states don't even charge sales tax, so I send him an email asking if it's just a mistake, because as I understand it, you're only supposed to collect sales tax in states where you have a physical business address. Here's his response
"Ok, well the reason is because of Wisconsin's tax laws. Some online
sellers
don't charge sales tax, but technically they are supposed to. Since we
didn't physically drive to meet you out of state the sale was made and
shipped here in Wisconsin and the state wants their cut. I hope that
explains it well enough for you! If you have any other questions
please let
me know!"
Is this BS or not? :confused:
 

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Total BS. You only pay sales tax when you get the car titled. You send the tax in with the title fees. You DO NOT pay sales tax to a retailer in WI. They are just trying to get another 5% out of you for their pocket. I have sold at least 3 cars out of state and have NEVER collected sales tax.
 

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was this a car, or parts?

From a dealer, or a private party?

I'm not terribly familiar with Wisconcin's tax laws, tho I do business with many companies "across the border." I do not charge my Wisconsin cstomers sales tax, only Illinois customer's. Many states have been trying hard to get "their share" of e-business going on in their state though.

I purchased a new car from a dealer in Milwaukee in 1986. When I told him I would title and tag it in Illinois, he did not charge me any sales tax or any other state fee's. That was 20 years ago tho.

Was a funny day, I was driving a late '70's "cop" malibu at the time, had never bought a new car in my life. Heard an add on the radio for an "invoice sale" dove by, and drove home in a brand new Monte SS! Talk about an impulse purchase!!!

Does anyone in Wisconsin actually know what the law is today?
LOTS of states are trying to collect taxes on e-business these days.
 

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Discussion Starter #4
Oh, sorry, it's a rebuilt alternator from " ***** Auto Electric we have been remanufacturing Premium Alternators, Starters, and Generators since 1968. " (actual name blotted out, I don't want to give them a bad rep in case they're right)
 

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If it is a legitimate business with a sales and use tax license, yes, they are supposed to charge sales tax on ALL sales, even internet.....MN has the same thing too. And yeah, most states are working very hard to identify internet sales to and from their states and find a way to get their "share". The taxation without efficient representation continues.:noway:
 

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Ive never paid sales tax for an item I bought from out of state, but maybe WI is different.

Ive always seen the disclaimer that residents outside of the vendor's state is exempt from sales tax.
 

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I thought you could only charge for STATE sales tax when you sell it to a buyer in the same state as the seller. If the seller is in Minnesota and the buyer is in Wisconsin, the seller cannot charge the buyer for WI sales tax.

How would WI keep track of the MN seller paying this tax to them or any other state.

I think the sales tax thing only applies to in-state sales. I have businesses in WI, MN and Michigan.
 

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I thought you could only charge for STATE sales tax when you sell it to a buyer in the same state as the seller. If the seller is in Minnesota and the buyer is in Wisconsin, the seller cannot charge the buyer for WI sales tax.

How would WI keep track of the MN seller paying this tax to them or any other state.

I think the sales tax thing only applies to in-state sales. I have businesses in WI, MN and Michigan.
You're correct, I went and looked at my sales and use tax booklet. I don't charge for out of state sales but THE BUYER IS SUPPOSED to report the purchase and pay the tax to their home state. That's what the states are attempting to track...what is purchased from out of state and shipped in so they know who owes them tax.;)
 

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This sums it up from the link you provided:

If you make sales to persons in other states, who take possession of your product(s) in those other states (for example, you mail the product to an address outside Wisconsin), those sales are not taxable for Wisconsin because they are made in interstate commerce.
 

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I'd guess he isn't sending the extra 5% tax he collects to the state, as you only charge the tax to buyers who live in your same state. I'd mention that you were going to contact the Franchise Tax Board (or whatever it's called in his state) to verify that he's supposed to be collecting the tax. My guess is since you have his name he'll drop the tax charge immediately.;)

Jody
 

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Discussion Starter #12
Update - I sent the seller that link, he cheerfully thanked me for the info, sent me a new invoice with the sales tax removed, and said he would bring it to his accountant's attention. :hurray: Thanks again for all your input on this.
 
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