Payment/tax in my situation?

C

Coolof

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Dec 15, 2010
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Hi guys. I used to be in bicycle rental business(if you can call this a business) for some time. Not anymore, But still have the website, that has traffic. So i am just selling the jobs to other businesses. They give me 30%.

Before the customer used to call me. i was doing some sort of reservation. and than they went to bike store and the guy was given me my %. But it is too time consuming. And a lot of times i never get my money - that's for sure)

So now i want customers to pay at my site. As i see paypal business account(allready have S Corporation) is the way to go. I am thinking of making people pay my % on the website and rest they gonna pay in bike shop. Do i have to collect sales tax in this case? since i am not providing any services, i just getting % for finding the customers. What is the best way to organise all this, cause it's not big money, maybe $1K-max$2K a month. Just wonna orginise everything right not to have any problems with IRS. Called NY tax department, but seem they know nothing about web.
 


Talk to an accountant, you can usually buy an hour of their time relatively cheap. It will be worth its weight in gold.
 
Show the 30% as a non-refundable "reservation fee", but quote the FULL rental amount on the site, and tell them the balance (plus tax) is due on pick-up and let the other guy worry about the sales tax. That way you're out of it, and it's HIS problemo, you get me?

But yeah, get a firm opinion from a tax accountant to be certain this is kosher, but I don't see why it wouldn't be.
 
Well first off I am an accountant during the day. It's only at night I put on a mask and cape to do AM.

You should be fine with galacon's proposed idea. You'll want to make sure there are no specific state taxes that apply to your "reservation" fee though. Sales tax usually applies to the sale of goods, and only if the buyer is in your home state too. Although I've heard rumblings this may change in the next few years. Lots of state governments getting pissed about not getting to tax all those juicy online sales. You can expect the issue to get bigger too since we are heading more and more online these days. But I digress.
If you plan on hiring someone to do your taxes this year, just hit them up while you are there. Free advice is always good.
Some food for thought. Your website is going to have to presell alot better if you want money from them in a nonrefundable way. Going to be a lot more hesitation on the customers end if they have to shell out a large chunk of money without even seeing the actual bike or talking to the actual people who are selling it.
A possible secondary solution might be, and this is just one man talking here, but get them to fill out a lead capture form. You can then forward it on to the individual store, while retaining the customers info for a post sale follow up email. You'll get points for showing the customer you still care een after the sale, while confirming if a sale was made and how much the seller owes you. Only down side is the extra time required to follow up. Plus side is, you get your money that's owed you. And if you have some good phone sales skills, you also get a shot at closing the deal with those that didn't buy the first time.

So two questions for you. Is it worth your time? And is a mask and cape really necessary? For the second one, I say yes. It makes me feel sexy. For the first, well that one is for you to answer.

Oh and 5 bonus points if you actually read all that :P
 
Hmm ... seems I missed the "rental" part - was thinking you were selling the bikes.

So disregard most of what my stoned ass rambled last night ... just double check with an accountant there aren't any city or county rental taxes. I know around here they tax everything at the coast. I rented a boat and was taxed.

If you don't have an accountant, just go on your local state business registry and do some research. It will be there if it exists, along with forms to file and reporting guidelines. :batman:
 
galacon, thx for advice. I will go with "Non refundable reservatione fee".

GoogleBitchSlap
If you don't have an accountant, just go on your local state business registry and do some research
Click to expand...
Yep. Goona make one more call to NY state tax department and after will talk to my account. The problem is usually they no so good in web.

In NYC there are a lot of website like"best tours NYC" who doing the sale of bike tours, bus tours, etc on their website - charge the whole amount + sales tax. And after i guess they transfer %70-80 to companies who doing the services. But i guess it's more troublesome way...

thx everybody for input.
 
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