Taxes - And Your Online Business

(Theyl Catch Up On You)

Doing business online is starting to be a much

preferred way of transacting business both by the

sellers and the buyers not only because it is way more

hassle-free than real shopping but also because it

provides a chance for a tax-free business transaction

to transpire.

However, the happy days of transacting business

without worrying about the taxes that come along with

it will soon be over because on July 1, 2008,

Washington will be joining 18 other states in America

that oblige certain online or e-commerce businesses to

pay and collect sale taxes.

If you have an online business or if you are planning

to start one, then you will also be required to

collect taxes from your consumers or costumers if ever

you are residing in a state that requires you to pay

taxes.

A State Law Passed In 2007

The changes to be implemented on July 1 are the result

of a state law passed in 2007. The certain state law

changes the way the taxes are calculated - a major

alteration that spurs some headaches and confusion

among all online retailers.

Take this situation for example: if you decide to shop

and purchase in a shop or store, you are obliged to

pay the tax rate depending on where the store is

located. However, if you decide to have the stuffs

that you purchased delivered to your doorstep, you are

obliged to pay for the tax rate of your state.

In technical terms, the tax system will be changed

from origin-based to destination-based.

The Tax Is Not Levied On The Business

Yes, you read that right - the tax is not levied on

the business, instead, it is levied on the part of the

consumer. It is the obligation of online businesses to

collect tax from its consumers and remit it to the

state.

The government is strictly issuing penalties for

businesses that fail to adhere to the law.

Online businesses are not excused from this law, in

fact, more law enforcers and agents are being sent to

check on the legality of online stores and businesses.

One common Internet myth is that the Internet Tax

Freedom Act allows online businesses from being

exempted from collecting sales tax from their

consumers. It is truly considered as one big myth

because in reality, it does not actually stop the

states from collecting sales tax on online businesses

and other e-commerce.

Sure, the Internet Tax Freedom Act does not impose

sales tax on Internet access fees but aside from that,

taxes are already imposed.

When You Make Money Online, You Have To Pay Taxes When

you earn, you really have to pay taxes; it a known

fact and perhaps what we can call a bittersweet

reality. Sure, it may be a bit difficult on our part

to surrender a part of our hard-earned money for tax

dues but the truth is, everyone is doing so.

All income-generating businesses and stores are

required to pay their due taxes. A law is a law and it

must be followed at all costs. Some people who are

involved in online businesses try to doge their

tax-paying responsibilities. They think they are smart

enough to be able to escape their tax-paying duties

but the truth is, theyl get into deeper trouble once

the government finds out their dirty work. If you want

to be successful in your carrer as an online

businessman/woman, try to be as clean and honest as

you can with your taxes and your online business.

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