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eBay and Sales Tax: 3 Things You Need to Know


Ready to sell items on eBay? Online merchants can list and sell just about anything on eBay; however, vendors first will need to figure out how to tax customers accordingly.

Fortunately, managing sales tax on eBay can be quick and simple -- here are three things eBay sellers need to know about complying with sales tax regulations.

1. eBay offers tax tables that are simple to set up

All eBay sellers are responsible for complying with applicable tax laws. And even though eBay cannot guarantee its sales tax features will meet all tax requirements, the website offers many helpful tools you can use to manage sales tax.

For instance, eBay's "tax table" feature enables merchants to determine a sales tax rate for each US state where sales tax is required. Sellers also can charge tax on shipping and handling (S&H) if required by law.

Setting up a tax table requires only a few minutes and makes it easier for sellers to comply with sales tax regulations. In fact, the tax table setup process consists of five steps:

  1. Go to My eBay, select Account, then Site Preferences.
  2. Click Show in the Payments from buyers section.
  3. Click Edit in the Use sales tax table section.
  4. Fill in the sales tax rate for any state where sales tax is required. If necessary, sellers can add tax for shipping and handling, too. To do so, select the Also charge sales tax on S&H check box.
  5. Click Save.

Take advantage of eBay's tax table feature and you'll ensure that you comply with various sales tax requirements at all times.

2. Sellers can charge sales tax on an individual listing

Want to charge sales tax for a specific listing? With eBay, sellers can alter the sales tax for an individual listing instantly.

Sellers will need to set up a tax table before they can charge sales tax on a listing. After a tax table is set up, vendors can add sales tax to a listing in three steps:

  1. Go to the advanced listing form, then click on the Add other details section at the bottom of the form. Next, select the Add or Remove option.
  2. Go to the Other details section, then select Charge applicable sales tax to buyers.
  3. Click save and complete the listing.

With this process, eBay ensures sellers should have no trouble adding an item and complying with any state's sales tax regulations.

3. A sales tax table can be changed at any time

Need to stop charging sales tax in a particular state? eBay sellers can update a sales tax table immediately.

Here are instructions an eBay seller can use to stop charging sales tax in a state:

  1. Select My eBay, followed by Account, then Site Preferences.
  2. Choose Show in the Payments from buyers section.
  3. Click on Edit in the Use sales tax table section.
  4. Remove the tax rate from the state where it is no longer necessary to charge sales tax. Also, clear the Also charge sales tax on S&H check box.
  5. Click Save.

In addition, here's how an eBay seller can stop charging sales tax in all states:

  1. Select My eBay, followed by Account, then Site Preferences.
  2. Choose Show in the Payments from buyers section.
  3. Click on Edit in the Use sales tax table section.
  4. Select Clear all at the bottom of the page.
  5. Click Save.

Of course, preparing and filing sales tax returns often challenges eBay sellers. But with Avalara TrustFile, online merchants can import data from eBay and file their sales tax returns quickly and efficiently.

eBay sellers can export their transaction data in CSV form from their eBay accounts and import it into TrustFile. Meanwhile, TrustFile automatically generates a free sales tax report, empowering merchants to review the states where they are collecting sales tax and file their tax returns correctly every time.


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