Author Mark Faggiano is Founder and CEO of TaxJar
July is what we call here at TaxJar a “sales tax perfect storm.” Nearly every online seller will have a sales tax filing due. Filing sales tax doesn’t have to be difficult, especially if you can avoid these 5 common sales tax filing mistakes:
Missing Your Deadline
Sure, missing a deadline is a common pitfall with nearly everything, not just sales tax. But sales tax deadlines can be especially tricky because they change from state to state. For example, California wants to hear from sellers on the last day of the month after the taxable period, while Georgia wants to hear from sellers on the 20th of the month after the taxable period. Other states have different due dates. To make matters worse, sales tax filing deadlines can move around due to weekends and holidays. Double check when your returns are due on this list of July 2016 Sales Tax Filing Due Dates.
Reporting the Wrong Amount of Sales Tax
When you file your sales tax return, states want you to break down how much you collected by state, county, city and other special taxing district. They also want you to report how much sales tax you “should” have collected, even if (for whatever reason) you were unable to collect the correct amount of sales tax. With states wanting all of this information, it can be easy to report the sales tax you’ve collected incorrectly. If you’re worried about reporting, TaxJar’s state sales tax reports can help you determine if you’re filling out each form correctly and if you’ve collected the right amount of sales tax.
Failing to File a Zero Return
States require that you file a sales tax return even if you don’t have any tax to report or remit. They consider this a check-in to let them know that yes, you are still in business. Forgetting to file a “zero return” can have consequences from a $50 fine to the cancellation of your sales tax permit. Don’t forget to file your zero return by your due date!
Leaving Money on the Table
About half the states that have a sales tax understand that asking you, as the seller, to collect and remit sales tax places an administrative burden on your shoulders. That’s why, as an incentive, they allow you to keep a small percentage of sales tax collected. When filing your sales tax returns in one of these sales tax discount states, don’t forget to keep your percentage! (If you use TaxJar AutoFile to file your sales tax returns, we make sure you keep your discounts every time.)
Have questions or comments? Join the conversation over at the Sales Tax for eCommerce Sellers Facebook group!
TaxJar is a service that makes sales tax reporting and filing simple for over 5,000 online sellers. Try a 30-day-free trial of TaxJar today and eliminate sales tax compliance headaches from your life!