As the weather warms up and spring cleaning begins, many people start thinking about hosting a yard sale. It's a great way to declutter and make some extra cash. But if you're planning on having a yard sale in Cherry Hill, New Jersey, you may be wondering if you need to collect sales tax.
Understanding Sales Tax
Sales tax is a tax imposed by the state on the sale of goods and services. The rate of sales tax varies by state and can also differ within a state depending on the county or city.In New Jersey, the state sales tax rate is 6.625%, but Cherry Hill has an additional local tax of 3.5%, bringing the total sales tax rate to 10.125%.Generally, businesses are responsible for collecting and remitting sales tax to the state. However, when it comes to yard sales, things can get a bit more complicated.
Yard Sales and Sales Tax
Yard sales are considered occasional sales, which means they are not regular or ongoing. In most states, including New Jersey, occasional sales are exempt from sales tax. This means that if you're having a one-time yard sale, you do not need to collect or remit sales tax.However, there are some exceptions to this rule.If you are selling items that were originally purchased for resale or if you are selling items that are typically subject to sales tax (such as new clothing or electronics), then you may be required to collect and remit sales tax.Additionally, if you are hosting a yard sale as part of a larger event, such as a community-wide yard sale, then you may be required to collect and remit sales tax. In this case, the event would be considered a regular or ongoing sale, rather than an occasional sale.
Yard Sales and Online Platforms
In recent years, online platforms such as Facebook Marketplace and Craigslist have become popular places to sell items. If you are using one of these platforms to sell items at your yard sale, you may be wondering if you still need to collect sales tax.The answer is yes. Even if you are using an online platform, you are still responsible for collecting and remitting sales tax on any taxable items sold at your yard sale.The only exception would be if the platform itself collects and remits sales tax on your behalf.
Registering for a Sales Tax Permit
If you determine that you do need to collect sales tax at your yard sale, you will need to register for a sales tax permit with the state of New Jersey. This can be done online through the New Jersey Division of Taxation website. Once you have registered for a sales tax permit, you will need to collect sales tax on all taxable items sold at your yard sale. This means keeping track of the total amount of sales and calculating the appropriate amount of sales tax to collect from each customer.Reporting and Remitting Sales Tax
After your yard sale is over, you will need to report and remit the sales tax collected to the state of New Jersey. This can be done online through the New Jersey Division of Taxation website or by mail using Form ST-50. It's important to note that even if you do not collect any sales tax at your yard sale, you are still required to file a return with the state indicating that no sales tax was collected.Conclusion
In most cases, you do not need to collect sales tax at your yard sale in Cherry Hill, New Jersey.However, if you are selling items that were originally purchased for resale or if you are hosting a yard sale as part of a larger event, you may be required to collect and remit sales tax. It's always best to check with the state of New Jersey to determine your specific sales tax obligations.
