Internet Sales Tax Solution Proposed
Although the feds have halted government bodies from taxing online sales until 2001, that doesn’t prevent some states from imposing a usage tax. These states require residents to report out-of-state purchases. While the law has rarely been enforced, some states plan to include questions about out-of-state purchases on this year’s state tax returns.
The logistics of ensuring the tax rates are correct for every state and every county are complex. For example, in Massachusetts, clothing isn’t taxed unless it costs more than $175 and in Texas, each county could have a different local tax rate. Taxware’s software promises to keep sales taxes straight while keeping all transaction in “real time.”
The software, Taxware’s Transaction Tax Server, begins beta testing this month and should be available by the end of the first quarter.