Retail stores need licenses to sell, but today’s question I hear everyone asking themselves as they get started in their chosen profession is: Do I need a license to sell my craft?
But really, you should first ask yourself — Is my craft taxable?
If you are selling a handmade product vs charging for your talents, then most likely your answer is going to be YES.
You’ll more than likely need a Sales Tax License. You can obtain a sales tax license through your state department. A lot of craft shows and vendor establishments will require you to have this licenses before allowing you into their facility.
If you don’t make a lot of sales in a year, don’t sweat it. Most states give you the option of filing your sales tax monthly, quarterly, semi annually, or annually. And now adays, you can fill out the form online or enlist the help of an accounting professional to assist you.
It’s a cake walk, believe me, if I can do it, so can you. If you need help, just give me a shout and I’ll be happy to assist you with it.
Now, let’s go back to talking about retail. What is it? Retail is basically setting up shop in a physical place where your customers come to you. In this case, you will need to check with your local chamber of commerce in the town where your retail shop is located for their policy and regulations of licenses and requirements for retail locations.
And lastly, let’s not forget those online shops like Etsy, Artfire, and eBay. Do you need a license to sell your craft online? Absolutely. You might think because you’re floating in cyberspace that you’re not covered by any state license laws, but it just ain’t so. You will still need to collect sales tax on all applicable items sold online for the state in which you live.
So for example. I have two shops – one at Etsy and one at Artfire. I live in Pennsylvania. So, I only collect sales tax from customers who purchase that live in the same state as I do.
See how that works?
Imagine how overwhelming it could become if you had to collect sales tax in all 50 states!! And let’s not even think about the hassles of international orders!
So for today, we’ll stick with were we are. Do you have a license to sell?