|Mon June 3 2013 15:14:25|
Demystifying the Marketplace Fairness Act
By: Julia Wilkinson
| The Marketplace Fairness Act of 2013, otherwise known as the "Internet Sales Tax," is still festering in Congress - currently in the House - but with its outcome uncertain, online sellers are still worried about what its passage could mean for them. But there is a new resource out there, salestaxchanges.com, that aims to answer sellers' questions and demystify the whole complicated hydra on the horizon. |
I spoke briefly with Rory Rawlings, Founder and Chief Tax Automation Officer of Avalara, the company that put the site together, and learned something. (Avalara's "elevator speech" is "We provide the fastest, easiest, most accurate and affordable way to manage sales tax compliance."). Did you know that under the terms of the Act, software for remote sellers affected by the bill to calculate and file returns for such taxes would be free? Rawlings pointed to the language in the legislation that spells this out (I know; bills don't necessarily make for great beach reading):
"Each Member State...under the Streamlined Sales and Use Tax Agreement" [would have to] "(D) Provide...software free of charge for remote sellers that calculates sales and use taxes due on each transaction at the time the transaction is completed, that files sales and use tax returns, and that is updated to reflect rate changes as described in sub
It goes on to say that there also must be provided "certification procedures for persons to be approved as certified software providers." So for the remote sellers affected by the bill, they would qualify for free software from certified entities to enable them to figure the taxes they'd owe per the legislation.
Still confused? Check out the Sales Tax Changes site, which has more resources aimed at sellers and specifically small business people. For example, there is a map of the U.S. states, and you can click four different colored buttons to see which states are "Streamlined (SST), Easy-to-Implement MFA, Hard-to-Implement MFA," or "No Sales Tax States."
There are also white papers and sections that explain tax terms such as "Nexus." ("Nexus: It's all about physical presence. Or is it?"). Part of me is afraid to find out.
But even if the MFA doesn't pass, it can't hurt to educate oneself about these legal and tax matters.
Did you know that under the MFA, the software provided to affected sellers would be free? Are you following the "Internet Sales Tax" (currently in the House), and do you think it will pass, or why not? Post a comment here!
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