Sales Tax Issues

[Michele]

I am trying to figure out what I need to pay sales tax on for when I do my taxes and report sales tax to the retail certificate board that is required.

If you book a photo shoot and get paid for shooting the photos, do you pay sales tax?
If someone purchases a photo to use in an advertising ad for their business, do you pay sales tax?
If someone purchases a photo to use on a banner for their business advertisement, do you pay sales tax?
Or do I only pay sales tax on the prints that I sell?

Thank you for your help in advance. I am in California, BTW if that matters...
Michele

[dc2]

. I am in California, BTW if that matters...
Michele
Matters to me

[Kevin Barrett]

Originally Posted by Michele

I am trying to figure out what I need to pay sales tax on for when I do my taxes and report sales tax to the retail certificate board that is required.

If you book a photo shoot and get paid for shooting the photos, do you pay sales tax?
If someone purchases a photo to use in an advertising ad for their business, do you pay sales tax?
If someone purchases a photo to use on a banner for their business advertisement, do you pay sales tax?
Or do I only pay sales tax on the prints that I sell?

Thank you for your help in advance. I am in California, BTW if that matters...
Michele

Tax laws vary from state to state. Hopefully your CPA will be able to advise you.

[Michele]

Thank you Kevin......

[Kevin Barrett]

Originally Posted by Michele

Thank you Kevin......

I just hand it all over to my CPA and hope for the best. Also, much depends upon how you've set
up your photography as a business etc. I'm fairly small potatoes for the most part, so I'm set up
under my name and utilize my social security number. This year I may investigate paying the state fee to
enable me to purchase materials associated with my end product tax free. However, I will need more sales
to justify that step.

Currently, I do charge sales tax as it is required by MI law for business transacted in this state. However,
for out of state or international sales, I do not have to charge sales tax etc.

In MI, we have a single business use tax that also comes into play. This explains in part why MI doesn't
attract as many new businesses as adjacent states do. We have a Govenor's race in 2006 here, and
it's one of the campaign issues. I'm not a single issue voter, but this will factor into to my decision.

I'm sure CA has it's fair share of taxation as well. It will be a piece of cake for a good CPA to sort through,
and well worth the peace of mind.

[Michele]

Thank you Keving for your info. For the last two years, I have done my own taxes, but this last year, things have gotten a little more complex and tax laws have changed a lot, so I might be going to a CPA this year. We will see. I am going to the tax board office on Tuesday to get some more info and clarity.

Michele

[bevilaquafoto]

In New York City (8.65%), I charge, and pay sales tax if I shoot for a client and deliver the images within New York State. When I do a shoot, I have my finance software (Quickbooks Pro) add sales tax for the shoot, as photography is a taxable service. I then pay out the sales tax that I have collected on a quarterly basis. If I am sending the job out of state as I do for my work with CNN, then I don't charge sales tax as I am delivering the job outside of my state. I also charge sales tax on anything at all that i am selling i.e. prints, CDs, contact sheets, etc. I do not pay sales tax on cameras, or other material purchased solely for use in business. This is called an "exempt use" exemption, and it pertains to all materials either re-sold, or used in the production of re-sellable material i.e. photographs. The laws vary widely state to state, and you should by no means take my word on this stuff. You need to contact your local or state taxation and finance agency. You need to be careful with sales tax. You can get into trouble if you are not circumspect about charging it fairly to your clients, paying out what you are supposed to, and fairly reporting purchases that were actually used for personal purposes. Personal versus professional has some leeway, by the way which I can go into further if you are interested. Sorry for the long post. i can explain more if you like.

[Michele]

Thank you so much for your explanation, Lorenzo. Good info there. Since my post, I have gone to the state board of equalization and got good advice, done my sales tax for 2005 and a tone of info to read and learn about. You have made some good points and a few I didn't think about.

Thanks again..