Denver Veloswap Oct 18 - sales tax?

[bargainguy]

Thinking of getting a table for this event, but somewhere in my mind lurks the presence of a Denver 7.73% sales tax on all sales from any vendor at the swap, private or commercial. Unusual tax situation for a swap meet, the only swap I know that works this way.

I'm not seeing many details of this online and wonder how this works. I know you have to remit a form which lists all sales and then calculate reimbursement to the city and send along, otherwise they'll get mighty upset.

In practice, how does this work? Do you mark up prices to compensate and eat the tax bill yourself? Or do you agree on a price to a purchaser and then ask them to pay the tax?

[redir]

Honestly? I wouldn't even go there if it were me.

[oldpotatoe]

Thinking of getting a table for this event, but somewhere in my mind lurks the presence of a Denver 7.73% sales tax on all sales from any vendor at the swap, private or commercial. Unusual tax situation for a swap meet, the only swap I know that works this way.

I'm not seeing many details of this online and wonder how this works. I know you have to remit a form which lists all sales and then calculate reimbursement to the city and send along, otherwise they'll get mighty upset.

In practice, how does this work? Do you mark up prices to compensate and eat the tax bill yourself? Or do you agree on a price to a purchaser and then ask them to pay the tax?

How it works is ya tell them you didn't sell anything. Business' worry about it and follow, private individuals, never heard of anybody collecting or paying sales tax. Cash and carry, no checks or cc.

[bargainguy]

How it works is ya tell them you didn't sell anything. Business' worry about it and follow, private individuals, never heard of anybody collecting or paying sales tax. Cash and carry, no checks or cc.

I wouldn't accept anything other than cash anyway, but I want no part of tax evasion, traceable or not. Call it what you will, but I believe in being upfront and above board, and letting other folks deal with the opposite. Just my M.O.

Wouldn't surprise me if there were "tax spies" lurking and monitoring large sales from specific booths, then comparing notes when the itemized tax bill arrives. They might not care so much on the little stuff, but sell a $2K bike and not claim it, they suddenly might become very interested.

Was more interested in how private sellers handle the tax issue - anyone?

[RedRider]

...

[buldogge]

Pick a price that you're comfortable with, including the 8%, and then simply back the tax out afterwards.

This avoids a change drawer/etc.

-Mark in St. Louis

[oldpotatoe]

I wouldn't accept anything other than cash anyway, but I want no part of tax evasion, traceable or not. Call it what you will, but I believe in being upfront and above board, and letting other folks deal with the opposite. Just my M.O.

Wouldn't surprise me if there were "tax spies" lurking and monitoring large sales from specific booths, then comparing notes when the itemized tax bill arrives. They might not care so much on the little stuff, but sell a $2K bike and not claim it, they suddenly might become very interested.

Was more interested in how private sellers handle the tax issue - anyone?

I was talking about private sellers, not booth owners that have tax ID numbers.

Re read me post.

[bargainguy]

Yep, and I still don't agree. As a private seller, if I wanted to evade the sales tax, I wouldn't even be asking this question.

[oldpotatoe]

Yep, and I still don't agree. As a private seller, if I wanted to evade the sales tax, I wouldn't even be asking this question.

Ok, then charge 7.76% more or whatever it is, log/record every sale, everything you sell and be prepared to do the paperwork...easy.

This started life as a 'swap meet', make my junk your junk. It has been invaded by huge resellers like Cambria and Richardson's bike mart, big bike shops doing inventory clearance...why the sales tax gig. I think velo'swap' has lost a lot and why I no longer go. It's almost a for sale Interbike, no longer for the little guy.

[pbarry]

Even three years ago there were some vendors who had usb card readers. E-trail and all that. Plenty on cash flying around the Natl Western building still. Live dangerously, get a table.

[oldpotatoe]

Even three years ago there were some vendors who had usb card readers. E-trail and all that. Plenty on cash flying around the Natl Western building still. Live dangerously, get a table.

It's big biz for some in and out of state BIG bike stores plus outside reps hawking their samples..no thanks..I liked it when it was at the CU field house. Really a little guy swap meet then..no mas.

[pbarry]

I was away from home in the early years, darnit.

The setup on Friday is when the best deals are made. For the last few years, a guy from CA rides around on a big wheel kick scooter and cherry picks the best bikes. Then there was a small group that would wait for the Mavic support wagon to roll in and buy up almost everything he had in the first 20 minutes on Saturday.

[Bruce K]

I have no clue about tax laws in CO but if you are a private seller and not a business isn't your participation essentially a yard sale?

I don't know of any yard sale that collects taxes.

You might want to contact the swap organizer to determine what the rules are or what deal the organizer might have made with state authorities

BK

[bargainguy]

I found this two-page PDF tax form online for the 2011 veloswap. Unless they've changed their tune since (and with taxes, do they ever really go away once started?), it's quite clear that they go after folks who don't fill out the form and/or remit taxes:

https://www.pdffiller.com/en/project/22772991.htm?form_id=56575

[pbarry]

I found this two-page PDF tax form online for the 2011 veloswap. Unless they've changed their tune since (and with taxes, do they ever really go away once started?), it's quite clear that they go after folks who don't fill out the form and/or remit taxes:

https://www.pdffiller.com/en/project/22772991.htm?form_id=56575

Filled out simikar forms for farmer's market sales in NYC. No big deal for a regular vendor.

You must have quite a stash to be concerned about a two-day mostly cash event. :rolleyes: Good luck with the long form if you don't already file that way: Proving your initial purchase investment, and declaring profit or loss based on your receipts from VS. Remember, many states have mandated sales tax on online purchases--only a few enforce the legislation..

[staggerwing]

Bit silly in a way. The small guy at a swap is just rotating personal toys, and not likely making money. More cutting losses, and freeing up some residual value, to make room for the current whim du jour.

Straight up, a sales tax is a consumption tax, and in the case of personal sales, should be the responsibility of the consumer. In Ohio, I am required to report any purchases that I made on out of state purchases in which tax was not collected, and pay the appropriate local sales tax on said purchases. In a recent case, I purchased a private sale vehicle, which just happened to be from out of state, although that didn't complicate the situation too much, and was required to pay local sales tax when registering the car locally.

In my opinion, which likely counts for little, only registered business should be required to report and collect sales tax. To be clear, even if it is a casual endeavor, if you are trying to turn a profit, or at least break even, it is a business. Moving some personal inventory, likely for less than acquisition cost, then "nothing to see here."

[oldpotatoe]

Bit silly in a way. The small guy at a swap is just rotating personal toys, and not likely making money. More cutting losses, and freeing up some residual value, to make room for the current whim du jour.

Straight up, a sales tax is a consumption tax, and in the case of personal sales, should be the responsibility of the consumer. In Ohio, I am required to report any purchases that I made on out of state purchases in which tax was not collected, and pay the appropriate local sales tax on said purchases. In a recent case, I purchased a private sale vehicle, which just happened to be from out of state, although that didn't complicate the situation too much, and was required to pay local sales tax when registering the car locally.

In my opinion, which likely counts for little, only registered business should be required to report and collect sales tax. To be clear, even if it is a casual endeavor, if you are trying to turn a profit, or at least break even, it is a business. Moving some personal inventory, likely for less than acquisition cost, then "nothing to see here."

Agree.

[Mark McM]

www.colorado.gov/cms/forms/dor-tax/drp0099.pdf:

An individual who makes retail sales from a private residence that total
$1,000 or less in a calendar year is not required to have a sales tax license.
However, taxes on these sales must be collected and paid by April 15
of the following year on the “Retail Sales Tax Return for Occasional
Sales” (DR 0100A). For more information on this topic, see publication
FYI Sales 8 “Sales Tax Requirements for Small Home Businesses.”

Four types of sales tax licenses are available in Colorado:
...
✔ Single Event Sales Tax License — required when an individual,
organization or vendor plans to conduct retail sales at a location
other than the regular business location (if any). The license
is valid for one event only. Examples would be a craft or
collector’s show. Organizers of an event may choose to obtain
a single event license and collect and remit tax on behalf of the
participating vendors.

It sounds like you should contact the even organizer about whether they have a single event sales tax license, and what their procedures are for individual vendors.

[Ken C]

Just to be clear Colorado has home rule jurisdictions. The City and County of Denver impose sales and use tax separately from the State. Their rules are even different on what is taxable. The state will collect the states sales tax, the RTD sales tax and the Cultural Facilities District sales tax. Denver will collect their sales tax.

The CO temp license would work for the state collected taxes but you will have to make sure Denver has something similar.

[Ken C]

The comparison to garage sales do not always work. The typical reason garage sales are exempt is for an occasional sale exemption. If you personally are not a retailer and you have a garage sale to sell some items most jurisdictions will exempt those sales since you are not in the business of being a retailer. This applies to you personally even if you have a business that is a retailer. The business would be treated separatley from the owner selling personal items.

Denver does not have an occasional sale exemption so therefore garage sales are taxable. So are sales at coventions, trade shows etc.

Here is your answer for the City, it looks like there more than a few options ranging to remitting tax with a letter to a special events license. It looks like organizers are required to submit a list of all vendors at the show to the City Finance Dept so compliance would be best. I would contact the organizer about a special events license for the City. As stated above you would have separate special events licenses for the state and for the City. Most likely the organizer has all the information you will need.

http://www.denvergov.org/Portals/571/documents/TaxGuide/Occasional%20Sales%20Rentals.htm

http://www.denvergov.org/Portals/571/documents/TaxGuide/Tax%20Guide%20Topic%2079%20-%20Trade%20Shows.pdf

[likebikes]

Did you end up making it to veloswap, bargain guy?

[cash05458]

"Denver does not have an occasional sale exemption so therefore garage sales are taxable."

Just curious...has anyone ever been gullible enough to pay this? Has Denver ever enforced it?

[oldpotatoe]

"Denver does not have an occasional sale exemption so therefore garage sales are taxable."

Just curious...has anyone ever been gullible enough to pay this? Has Denver ever enforced it?

Doubt it. I was very diligent about sales tax collection and paying when owning the shop(my thief of a biz partner, not so much)...BUT I know many who go to veloswap, private individuals and I have never talked to one who paid sales tax.

On any sunday, the scads of garage sales around, selling that little doo-dad for $.50, I really doubt anybody pays any sales tax.

[cash05458]

"On any sunday, the scads of garage sales around, selling that little doo-dad for $.50, I really doubt anybody pays any sales tax."

yeah, I can just see it Pete..."ok, so my 9 year old kid sold those 4 beat up power rangers he outgrew for 85 cents...now 7.7 percent of that for the good city of Denver is...oh let's see."

similar stuff here in Vermont...tho not overly ridiculous like that, is if we buy anything outta state...like new hampshire where alot of folks near border do all their shopping...or on amazon...we are supposed to fill out these long forms to pay the state their sales tax...I have never heard of anyone doing it, even for fun...but once in a while the local stations do a little pr thing as news of the governor buying something from amazon...say a box of new staplers for the office and then showing him at his desk diligently filling in his forms to report it

[bargainguy]

Well, I went, had a blast, tabulated my sales and paid the tax before I left.

But I talked to several vendors who were not aware of the tax situation. Since veloswap sends the vendor info to the city, methinks these folks will get contacted soon. Even if a vendor has no sales, they still have to submit the tax form and sign.

[ultraman6970]

We need a darn swapmeet here in DC metro... now gonna have to wait till march and drive like 2 hours hehehe

[likebikes]

Did you see any "tax spies" while you were there?

[bargainguy]

I thought about that...how would I know what to look for? Pocket protectors? IRS baseball cap?

One thing for sure, lots of stuff getting sold. The folks a couple tables down bought $22K worth of MTBs and parts to sell back home.

[Mark McM]

"On any sunday, the scads of garage sales around, selling that little doo-dad for $.50, I really doubt anybody pays any sales tax."

yeah, I can just see it Pete..."ok, so my 9 year old kid sold those 4 beat up power rangers he outgrew for 85 cents...now 7.7 percent of that for the good city of Denver is...oh let's see."

similar stuff here in Vermont...tho not overly ridiculous like that, is if we buy anything outta state...like new hampshire where alot of folks near border do all their shopping...or on amazon...we are supposed to fill out these long forms to pay the state their sales tax...I have never heard of anyone doing it, even for fun...but once in a while the local stations do a little pr thing as news of the governor buying something from amazon...say a box of new staplers for the office and then showing him at his desk diligently filling in his forms to report it

In Massachusetts there is a line item on the state income tax for declaring out-of-state purchases, and the filer is responsible for paying the use tax (i.e. sales tax) on those purchases. So yes, you are responsible for filling out forms for calculating tax owed. However, the Mass. tax forms do allow a filer to enter a "safe harbor" amount, which is a single default tax value, in lieu of itemizing every single out of state purchase.