Sales Permits & Taxes – Even Artists Need to Know

money.artWe’ve talked about having a product and the ability to take credit card payments. Now we’re getting into the grown-up stuff. So, let’s dive in.

Pay your sales tax. Just do it. It is quite easy to get a sales permit and there is not a lot of paperwork involved in filing sales tax. As a disclaimer, I am not a lawyer or tax accountant and none of this is to be seen as legal or tax advice, and yada yada yada, but please, do yourself a favor and do this right. The tax department is nothing to mess around with.

So – go to your state website and get a seller’s permit. It is super easy and fast. Go to a search engine and type something like “sales permit [state, i.e. California]”. Your “dot gov” government website should pop up.

Here is a link to the California government website for more info:

http://www.boe.ca.gov/info/reg.htm

Here is a link to the eReg registration for a California seller’s permit.

https://efile.boe.ca.gov/ereg/index.boe

Simply answer the questions and click through. Again, this is in no way legal advice or tax advice. Speak to your lawyer or tax guy or favorite legal professional type for more on this.

One tricky little bit on the whole applying for a CA seller’s permit that may hang you up: On the second page of the Selling Items & Good in California form, you will be asked to click boxes with a bunch of different options that may apply to you. Here is the catch – if none of these apply to you do not click any and just click Next. This is something that may get some people stuck so I thought I’d mention it.

Now, you will go through the entire process and enter all your personal information, etc. In the end you will be given a seller’s permit number and a filing frequency. Depending on the amount of revenue you are expecting, the state will insist upon filing once a month, once a quarter or once a year.

Set up a separate account for your taxes. This account should be for your taxes only. Do not touch the money for any other reason but to pay your taxes. Put your percentage in there every month. For example, if sales tax percentage in your state is 9%, set aside that amount each month. If you make $100 in sales for the month, set aside $9 for sales tax into that account. (You also need to be setting aside monthly for income tax based on your tax bracket but that is for another article.)

File your sales tax report accurately, on time, every time. Just do it. Trust me. This is a business now. Take it seriously. Keep track of things. If you are bad at keeping track of things and filing things, enlist someone to help you out. BUT – you are 100% responsible. It is your social security and your tax record. You must be the one to cross-check everything. Don’t trust that someone else is taking care of it. Verify that it has been done.

If you are having trouble understanding any of this sales tax stuff, contact a local tax attorney or accountant who can help you out. Have fun, make lots of money, pay your taxes. Welcome to being a grown-up. It is fun and easy as long as you are doing things the right away – so keep it simple. It only gets complicated when you don’t follow the rules. Have fun and make money!

 

HOMEWORK:

1) Get a seller’s permit.

2) Set up a separate bank account for taxes only.

3) Set up a system for tracking your sales revenue simply and accurately.

4) Set up a system for filing and paying your sales tax in a timely manner.

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C.R. Cohen’s love affair with words and the arts has lead her on a lifelong journey as a poet and writer and an art activist, founding Artists Underground, to bring networking, resources and advice to artists, and joining forces with Soapbox Nation to provide creative career consultations and artist services to help artists get further faster.

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About C.R. Cohen
C.R. Cohen’s love affair with words and the arts has lead her on a lifelong journey as a poet and writer and an art activist, founding Artists Underground, to bring networking, resources and advice to artists, and joining forces with Soapbox Nation to provide creative career consultations and artist services to help artists get further faster.

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