Wednesday, September 21, 2005

FAQ - Which tax applies when customer orders in my store?

FAQ - Which tax applies when customer orders in my store?

A customer comes into my store (let's say Louisiana) and orders TPP, which I then ship to his office in a neighboring state (let's say Texas). Which tax is due?

If your agreement with the customer is that you ship to his location in Texas, then Texas tax applies (along with Texas rules). That assumes this was equipment that the customer couldn't take with him - in other words, the sale wasn't consumated until he got the goods in Texas. If he could have taken it, and you shipped it "for his convenience", then the title probably transferred in your state, and therefore Louisiana tax and rules apply. This is a gray area and you need to look very carefully at your state laws.

STG

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