To Charge Sales Tax? And how to start that process?

[aliciamaebayer]

Hello,

I run a small business teaching seminars in CA (which is a service so we don't charge Sales Tax). We just started selling Audio CDs online and have heard that we should charge Sales Tax for them, since they are products. They count for about 3% of our income, very little.

I would like to know what the opinion is out there- should we charge Sales Tax for them?

If we don't charge Sales Tax and get caught, does any one know what kind of fine we would pay?

And from someone who has gone through the process recently of starting to charge Sales Tax, what is the process, is there a ton of paperwork, any suggestions, etc?

Thank you

Alicia

[jr429]

Alicia, california sales tax is straight forward - just go to the BOE (board of equalization), pickup the forms, and make sure you pay every quarter. It's a very easy process, and it's not worth the risk as in California it is far more common to be audited for sales tax. My last sales tax audit cost me $8k (for an enrolled agent) even though we were very clean.

[kimbeckers]

I agree, I am not familiar with CA laws as I am from NY but I would venture to say it is not worth the risk of not collecting and paying the sales tax.

They should have a website that should be able to register online for.