The Proven 10 Step Process to Register Your Sales Tax Permits
Your focus should be on growing your e-commerce business, not on the sales tax permit registration process. There are several options to complete your sales tax permit registrations. Those include filing for permits on your own, hiring your CPA, as well as going through an online service. The key is to have enough information to be able to evaluate what service is best for your situation. Below are the steps in our process as well as costly mistakes to avoid when it comes to sales tax permit registration. These proven steps come from our experience from applying for thousands of permits over the last four years. We have perfected the process (even with all the states changes).
Our sales tax registration process will take you through the steps to be able to collect and remit sales tax. We have outlined said steps in a simple, easy to follow the video below. The overview will help you effectively go through this process and get back to selling online and generating profits.
The Top Costly Sales Tax Permit Registration Application Mistakes to Avoid:
- Online Advice. Relying on what someone else in a Facebook group did in order to apply for a Sales Tax Permit is likely to lead you in the wrong direction and potentially cause costly mistakes. It’s simply not worth following leads without a legitimate basis and dealing with the possibility of monetary penalties or being accused of sales tax evasion. Even tax attorney’s who are not familiar with FBA may often only beware of the changes since June 2018, not all the states sales tax FBA concerns prior.
- Inaccurate Applications. Submitting a sales tax application online or via a PDF with mistakes, incomplete information, or missing documentation are crucial errors that will cause delays to your application process up to 1 or 2 months, costing you unnecessary financial penalties with interest.
- International Applicants without a Social Security Number. Not knowing how to submit an application without a U.S. Social Security Number (SSN) will most certainly cause delays, especially for overseas Amazon FBA Sellers. We can help you fill out and file your applications right the first time. Update: some states require you have an ITIN. We do have a separate referral resource, but this process may take several months to receive an ITIN from the IRS.
- When To File, When Not To File. Not knowing which states to file right away, or which states require a waiting period when applying for sales permits can cause unnecessary issues that could be easily avoided with professional help. This is much more complex now since the Wayfair vs. South Dakota case in 2018. You have to evaluate, physical nexus, economic, notice and reporting and marketplace facilitator in several states and the different thresholds for each category, if at all. We have all the details you need in Sales Tax System to determine which factors to evaluate and which states to register for first. Don’t want to figure this out on your own? We have other services to do this part for you. Committing fraud with the wrong start date may result not only in 50% fraud penalties, but a felony in some states (you would be surprised how often this is recommended).
- Using Your Address when Applying. States do not recognize international shipping rates and foreign addresses in their systems. It may take up to 2 months to receive a completed mailed application. If you do not receive it at your foreign address, this will delay your ability to collect sales tax. Even U.S. sellers will receive “buckets of mail” and the time to sort through all the mail to your address will most likely lead to delays and more fees. Some promoters “overpromising” by saying let us apply for your permits and you may also use our address. An efficient mail scanning and sorting service require dozens of hours (and a team) to assemble, manage and maintain weekly. We know because this is what we have done with our virtual mail and scanning service. If the promoter does not even have a separate marketing piece to outline the mail, costs, process… they are simple overpromising and will not be able to keep up, costing you time and money.
- Foreign Registration/Qualification Mistakes. Not knowing which U.S. states require entities in the U.S. or internationally to register/qualify in a state before or after you register for permits will lead to unwelcome surprises down the road. This will cost a fortune in time and money to determine each state and what they require before and after you apply (and it changes).
- Forgetting/Not Knowing To Open Tax Accounts. You will need tax accounts opened in order to remit sales tax to each state’s Department of Revenue. Some states do this automatically, others require multiple steps that you need to make sure you get correct or your mistakes could lead to numerous problems in the near future.
Our Complete 10-Step Sales Tax Permit Registration Process:
Step 1. Order Permits.
Choose order on the link below, and change the number in the product to the number of permits you would like. State fees are separate. A separate payment link will be sent to you after your application is submitted.
Step 2. Review, Initial and Sign our Sales Tax Permit Service Process Agreement.
Before we apply for your chosen sales tax permits, you will review, initial and sign our Sales Tax Permit Process Agreement for you to review and sign. Our goal is to help manage expectations with all the steps before and after we apply for permits. Your next step will be to remit sales tax, and in order to do this, we will provide you with the necessary steps.
Step 3. Complete Sales Tax System Application.
You will receive an email with a sales tax system general application form to complete, via a secure online link. We provide access to a video overview with important tips to walk you through the application. As well as this, you will be able to mark the appropriate checkboxes for the states you require, your start date with sales, and estimated sales amount per state. Once you select and submit, we will receive the application to review within 24-48 hours. We do recommend our U.S. virtual address and scanning services, even for U.S. sellers, because when you apply for sales tax permits in 20 to 30 states or more you will receive 4-5 pieces of mail per state per month! Learn more at this link with our U.S. mail services.
Step 4. Complete and Finalize Tax Permit Applications.
Before we apply for your chosen sales tax permits, our team of experts will complete any extra steps that are required prior to submitting your application(s) for obtaining your sales tax permits. This is one of the most important parts of the process. You will benefit from the thousands of permits we have applied for in the past plus the current state processes we know because we apply daily to help you avoid mistakes.
Step 5. Payment of State Fees.
You will receive an email with an itemization of any state fees, plus a payment link. Also, you will receive a list of next steps, including states that require additional steps after registration, to verify if you want us to move forward and apply.
Step 6. Apply for your Sales Tax Permits.
The Sales Tax System team will prudently submit and track your applications to your chosen states, both online and by mail.
Step 7. Sales Tax Permit Summary Document.
You will receive a comprehensive spreadsheet report in a secure Google Drive folder with all your sales tax permit information and the different stages each state is at. Some states we will have the permit, some states you will need to create a tax account (see step 8). We provide a video overview to simplify the process.
Step 8. Next Step Documents.
You will also receive documents within your secure Google Drive folder advising you which states you will need to open tax accounts in order to remit sales tax as well as providing steps for those states. In most states, the tax accounts are opened automatically, but not all (some states will mail a letter with the final steps).
Step 9. Update Your Shopping Cart/or Platform Tax Settings.
Once you receive your permits from the states, you will be able to update your tax settings with a “cheat sheets” that we will provide for you (this is important especially if you are selling on multiple platforms).
Step 10. Remit Sales Tax.
We will introduce you to our preferred sales tax remittance partner(s) who can assist with remitting sales tax in all states required. In order to remit, all your tax accounts will need to be set up (see step 8).
Q: What is your Time Frame to Apply for Permits?
A: The time frame in which you will receive your permits will vary from state to state, anywhere from 3 business days to 8 weeks after you have submitted completed applications and you have approved our Next Step Documents.
Q: What Support Will I Receive?
A: If you have any questions about the sales tax application process, email correspondence regarding the process is included in our low per state service fee. If you have questions about being behind on sales tax, what you may owe, your best strategy moving forward, etc., we offer paid consulting sessions which are not included in our permit service fee and require an additional charge.
Q: What Additional Steps are Required After You Apply for My Sales Tax Permits?
A: Step 8, our Next Steps Document, outlines the states that require additional steps after you apply for sales tax permits including foreign qualification if an entity. Sales Tax System has an update for each state with the state tax returns that are required in many states annually.
Don’t have time to register for your own sales tax permits? Learn more about your best options when registering for sales tax permit registration.