Tax Law (Questions About Taxes)/Sales tax

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Question
Hello Mr. Stancil,

My cousin has a website, in which she sells women's clothing.  She has 5 spots left and offered them to me; to sell earrings.  She told me I am responsible for incorporating tax within the price of the earrings.  I did research to find out how much tax to charge, but became confused.  I will do my business in Chicago. From what I understand, I must charge 10.25% tax to Illinois residents. But I am stumped regarding the following:

Do I charge that same amount to everyone, regardless of where they live? Or

Do I charge tax based on where the customer live? If so, how do I find out what to tax for each state?

Also
Does the 10.25% tax for Illinois include local and state? I would appreciate any advice you can offer.

Than you
Renee

Answer
Renee,

Thanks for your question.

Since you are based in Illinois, you are only responsible to collect sales tax for shipments to Illinois addresses. I am not familiar with the Illinois laws, but you would need to register with the Department of Revenue to collect and remit the taxes collected. They would provide information about the rate. Some states only subject online sales to the state rate, others include the local rate.

http://www.revenue.state.il.us/businesses/taxinformation/sales/rot.htm

Hope this helps.

John Stancil, CPA  

Tax Law (Questions About Taxes)

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John Stancil, CPA

Expertise

I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at www.mybaldcpa.com. I also offer seminars and consultations to churches and clergy on their tax issues at www.churchtaxsolutions.com Also visit my blog, www.thetaxdocspot.com. I am listed on Tax Connections at https://www.taxconnections.com/profile/John-Stancil/12258973 Prepare and file your own taxes at www.1040stancilcpa.com

Experience

I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

Organizations
FICPA, NATP, NCPE Fellowship, Lakeland Business Leaders

Publications
The CPA Journal, Florida CPA Today, Green Consumer, Green Business, Global Sustainability as a Business Imperative, Palmetto Review, NATP TaxPro Quarterly, Mustang Journal of Finance and Accounting.

Education/Credentials
DBA University of Memphis MBA University of Georgia BS in Accounting Mars Hill University

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