We went live today (November 12, 2019) with optional sales tax in Florida, Michigan, Tennessee, Kansas and Missouri. These are all non-Marketplace states – see here for an overview of the difference from Marketplace states. We will be rolling out all states by early December.
There are several good resources for you to refer to for more information:
- Sales Tax Policies
- Taxability Matrix
- Detailed Implementation
- Sales Tax Webinar
- Sales Tax Refunds
- Sales Tax Address. Related, we added Shipping Address Features which trigger the proper ship to address tax calculation.
In states that do not have Marketplace Facilitator laws and that consider items sold on our site as taxable we will give races the option to “turn on” the calculation and collection of sales tax for your race or event in any of the Non-Marketplace Facilitator States. If sales tax is turned on for your event we will automatically determine the taxability for race registrations and any other items that you sell and that you map to one of our taxability codes. You have the responsibility for determining whether to “turn on” sales tax in any Non-Marketplace states where you have a race or event or where you ship any store items sold on our site. You also have the responsibility for the proper set up and taxable classification of taxable items you sell on our site.
There are several steps to run on Sales Tax in non-Marketplace states.
Step 1 – Sales Tax Setup
Under the Financial tab, click on Sales Tax V2 and then Sales Tax Setup. There are two basic things you need to setup here.
First, the taxability address. This is normally the address of your race. However, if your race address is in a park or not a valid address that sales tax systems do not recognize, you can set that up here. Look for a valid street address that is close to the start.
Second, you can set up General Exemptions. Certain states like Florida have special exemption laws. In Florida race fees are not taxed if the event charges an admissions fee for spectators. You will need to agree to the terms indicated in the exemption and assume liability if this exemption does not apply to your event.
Finally, if your organization is a nonprofit, there are exemptions available in many states. Again, you must agree that your organization complies with the law and accepts liability if the exemption does not apply. These exemption rules are very detailed and there may be more than one type of exemption per state, so please be sure to review carefully.
Note also that you can set your exemption status in other states. This can be useful for national organizations that are operating a large race and shipping items to other states.
If your RunSignup Payment Account is not set up to be a nonprofit, then you will see a message that explains that you are not eligible for setting up the exemption. You will be able to send appropriate documentation to RunSignup and we will help. Also note that you may need to update your payment account with the correct information and status.
Step 2 – Taxable Items
Under the Financial tab, click on Sales Tax V2 and then Taxable Items. This is where you pick the appropriate type of Taxability Code for the item. Again, this is important as we default to the “General Taxable Item”, which may not be taxed appropriately for the items you are selling as Add-On, Giveaways, and Store items.
Step 3 – Turn on Sales Tax.
Under the Financial tab of your race dashboard, click on the Sales Tax V2, and then the Sales Tax Jurisdiction Setup. It will show a list of states, and clicking on your state will enable the collection of sales tax based on the information you have set up before.
This will start calculating sales tax on the next transaction. If there is a sales tax, it will collect that from the participant and we will make payment as part of our regular payment schedule for your payment account.
As covered in the detailed sales tax implementation blog post, we have two reports for you to understand the sales tax. The first is the sales tax transaction report, which will look something like this:
The second report is a summary, which is useful for reporting sales tax to the state: