Sales Tax FAQ
TireTutor collects and remits sales tax.
- TireTutor operates as a “marketplace facilitator”, just like Amazon. The relationship is such that TireTutor is the “marketplace facilitator” and “Dealer” is the “marketplace seller”.
- In the case of marketplace relationships, most states have placed the burden of tax collection and remittance on the “marketplace facilitator” (TireTutor).
- In each state, when and where appropriate, TireTutor registers with the state and remits sales tax to the state on a monthly or quarterly basis, along with relevant reporting.
- The “marketplace seller” (“Dealer”) does not collect the sales tax, nor remit the sales tax, nor receive any sales tax funds. This responsibility lies with the “marketplace facilitator” (TireTutor).
FAQs:
Who is responsible for collecting and remitting sales tax?
A “marketplace facilitator” is considered to be the retail merchant with regard to sales by “marketplace sellers” on its marketplace. Such sales are not legally considered to be sales by the “marketplace seller” for sales tax purposes.
How does this impact you, the “marketplace seller” (“Dealer”)?
As the “marketplace facilitator”, TireTutor collects and remits taxes, when and where appropriate. The “marketplace seller” is not required to collect or remit taxes on marketplace sales.
How should a “marketplace seller” report marketplace sales through a marketplace?
An RO for the net amount of the sale (after fees and excluding sales tax–as “Dealer” is not part of the sales tax process).
- Dealers write the RO with “TireTutor Marketplace” as the customer/vendor.
- Process debits/credits on the RO as appropriate.
AND/OR, an internal accounting journal entry to record the net amount collected from TireTutor on the sale, after fees.
Summary:
The states typically dictate that the “marketplace facilitator” handles tax collection and remittance–not the “marketplace seller”. We have updated our tax tables to account for county and local taxes, and will collect/remit taxes when/where appropriate.
Example of States Documentation:
- https://www.in.gov/dor/business-tax/remote-seller-information/marketplace-facilitators/
- https://www.ilga.gov/legislation/ilcs/fulltext.asp?DocName=003501050K2d
TireTutor Tax Certificates by State
Please click on your state to view TireTutor’s proof of certification.
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