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View Full Version : Do I need to charge sales tax?



magicman
12-21-2010, 04:02 PM
I am a magician performing at parties and events. I have never charged sales tax for shows under the advice of an accountant.

I am now planning on giving out some things at my shows, magic wands and little magic books, to each child. Am I required to collect sales tax now that there is a tangible product? Or am I giving them away free with the show?

Steve B
12-21-2010, 04:07 PM
Unless you are selling them, my guess is you're stll O.K. But, since tax law is determined by state and local govt's, you're going to need to tell us where you are before the tax people can give you advice. I think there's a spot to put your location on your profile so it shows up in your member information on the left of each post. You can see, mine shows up under my Join Date.

magicman
12-21-2010, 04:25 PM
I had checked what I needed under the NY licensing website, and was told I only need a business licenses/dba. I have a Tax ID number to collect and pay sales tax for when I do sell/pitch magic tricks at event such as craft fairs and street fairs.

The party packages I have planned include the giveaways for up to 15 children, and then the parent must buy the additional ones. I would charge sales tax for the additional ones.

huggytree
12-21-2010, 04:30 PM
the govt tells you what you need to tax...its different for every business...your accountant should help you...

i charge tax on repairs, but not on improvements.....repair=tax, replace or new=no tax

there is some grey area in my business and im sure you'll find some in yours also

Steve B
12-21-2010, 06:08 PM
In my state, I'm suppused to charge for parts, but not for labor. But, I don't like to break down my invoice and show the customers how it breaks down, so I charge one flat fee and charge them tax on all of it. My accountant said the state will be happy to collect the extra tax. I've only had 2 customers ask for a breakdown in hopes of avoiding the tax on the labor.

The above applies to a full dog fence installation. If I'm just doing a repair, I don't charge for the labor portion.

jamesray50
12-21-2010, 11:53 PM
Do you have a reseller exemption certificate for sales tax? If you do and didn't pay sales tax when you purchased the items you gave away, then you will be responsible for paying the use tax when you file the sales tax return. But check with your state to see if this is correct. This is the way it works in my state. I really don't think you would charge the parents tax on the free gifts. But the tax does have to be paid by someone.