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Musiciansfriend.com charging tax?
http://leftybassist.com./viewtopic.php?f=14&t=3725		 Page 1 of 1
Author:  Frenchy-Lefty [ May 30th, 2012, 10:34 am ]
Post subject:  Musiciansfriend.com charging tax?
I recently bought something from Musiciansfriend.com and had to pay for sales tax. I never did before. I don't know if it is only for California residents and I don't know if it is the same with the other on-line gear stores.
Does anyone know about this? I guess it'll make music gear a little less affordable but will bring more fairness for the brick-and-mortar local stores. In that case, I'd rather buy locally if I find the same item.
Author:  Addison [ May 30th, 2012, 12:08 pm ]
Post subject:  Re: Musiciansfriend.com charging tax?
I think the current general rule is that if the business you purchase from has any kind of warehouse, shipping facility, or business office in your home state, then you are charged sales tax. If that business has no working address in your state, then you can still get away with not paying for sales tax.

I just ordered something from a "mom & pop" out of state and I was not charged tax.

However... lots of online retailers now charge you sales tax no matter what. Amazon kind of started the trend a few years ago in preparation for some laws that were supposedly being passed, and a lot of the "big box" type stores started following suit. Apple even charges sales tax on their MP3's and app downloads.

I haven't ordered from MF in a while, but... it could very well be that they've decided to start doing so, especially since they're now under the Guitar Center umbrella, who operate in just about every state in the union.
Author:  pjmuck [ May 30th, 2012, 12:13 pm ]
Post subject:  Re: Musiciansfriend.com charging tax?
Yep, from the horse's mouth:

We are required to collect sales tax on all orders shipped to California, Indiana, Missouri, Utah & Washington. If you are shipping item to any one of these states, you will be charged the local sales tax rates.

Colorado, Oklahoma, South Dakota & Vermont Residents: Musician's Friend is not obligated to, and does not, collect sales tax in your state. Your purchase is subject to sales/use tax in these states unless it is specifically exempt from taxation. The purchase is not exempt merely because it is made over the Internet or by other remote means. These states require that you file a sales/use tax return at the end of the year reporting all of the purchases that were not taxed on those purchases. Retailers that do not collect sales tax in these states are obligated to provide purchasers an end-of-year sumary of purchases in order to assist them in filing their tax report. Retailers that do not collect sales tax in these states may be required by law to provide the Department of Revenue with an annual report of the total amount of all of your purchases above certain thresholds. Details on how to file this return may be foundat your applicable Department of Revenue website.


Not listed in that list is also NY and NJ, where both require sales/use tax. What is "use tax" you ask? just another way for states to ream you for making out of state purchases to cover the loss of sales tax you're not paying to your state, so goodbye online deals. (If you do plan on making many out of state or online purchases, consider itemizing and/or depreciating them). Since I itemize every year, I always depreciate higher ticket items and or take the full deduction and claim a small usage tax amount to hopefully "keep them happy." (If you got audited, it would be from the state not the IRS). In addition, starting next year, Paypal is going to 1099 you for any income you receive via Paypal via credit card/debit payments. FYI:

Form 1099-K
Form 1099-K is a new form for 2011 that is used for reporting the income that
you received by credit card, debit card, or electronic payment (e.g., ePay,
PayPal, etc.).
For 2011 the IRS will not require you to report these payments separately.
TurboTax will not give you a separate field for the amounts reported on your
1099-K(s), so be sure that you visit the other income topics to report any
income that you received via credit cards, debit cards, or electronic payments
in 2011.
Important Note
For 2012 you will need to report these types of payments separately from your
other income. Make sure to track these payments and keep accurate records
for when you file your 2012 tax returns.
For more information on Form 1099-K, visit our 1099-K support site.
Author:  Frenchy-Lefty [ May 30th, 2012, 6:24 pm ]
Post subject:  Re: Musiciansfriend.com charging tax?
For the Paypal 1099, I can see why though. There's possibly a bunch of Ebayers making a living selling on Ebay and not paying taxes. I'm pretty sure there will be a tax waiver under a certain amount.
Now, for the tax on on-line business, It somewhat sucks for us but will slow down the death of mum and pop music stores.
Author:  gravesbass [ May 30th, 2012, 8:14 pm ]
Post subject:  Re: Musiciansfriend.com charging tax?
Frenchy-Lefty wrote:
I recently bought something from Musiciansfriend.com and had to pay for sales tax. I never did before. I don't know if it is only for California residents and I don't know if it is the same with the other on-line gear stores.
Does anyone know about this? I guess it'll make music gear a little less affordable but will bring more fairness for the brick-and-mortar local stores. In that case, I'd rather buy locally if I find the same item.


MF and Music123 have been collecting CA sales tax since the beginning of the year. Sweetwater, Americanmusical and zZounds do not collect sales tax in CA.. yet!
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