Is a TAX ID required to buy from suppliers?

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dbarksda34751
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21 Dec 13 01:38:18 am
I am noticing by clicking on most of the Dropshippers, that they require you to be a company and have either a resellers number or a tax ID. I feel like this should have been somewhere in the print before I submitted my money. I know that I must PAY taxes, I just wish that they would have stated this on SaleHoo beforehand...


Last edited by fudjj on 22 Dec 13 08:42:29 pm, edited 1 time in total.
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friendlyvender
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21 Dec 13 02:35:50 am
I know what you mean I felt this way too. I never thought much of it when I was starting out but I should've done more research. I thought since I wanted to drop ship my situation would be different. I came to find salehoo through youtube where I saw good reviews for this site.

I still think this is a good directory and company, I like it here, but I do feel a little ill-prepared as I feel naked in comparison to everyone else. I don't know why I would've thought that I wouldn't need a tax ID.

I'm still figuring out my next steps

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dbarksda34751
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21 Dec 13 03:52:12 am
I get you. I thought that since I wanted to start off selling on Ebay that I wouldn't need all of that. I'm sure that it shouldn't be too hard to get at least a resellers/distributors certification. Well see what happens, I have a year to think about it.

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fudjj
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22 Dec 13 03:00:34 am
In regards to a TAX ID

What you will find is that typical wholesalers will require such, however dropshippers typically will not require it at all. So when you searching through the directory, anyone requiring such will most likely be a wholesale supplier, not a dropshipper.

If you want to deal with a wholesale supplier, then there is no way around providing a TAX ID.


Mark (fudjj)

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friendlyvender
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23 Dec 13 07:42:37 am
So if I am a drop shipper with a Tax ID would that make a difference, as in would I be getting better prices on goods, or would it not matter because they have different rates for that altogether since those prices should be higher than wholesale?

I read from the salehoo manual if they dont as for it or you dont tell them, then your are getting closer to retail prices (pr maybe that only applies to wholesaling?? )

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fm1234
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28 Dec 13 07:32:47 pm
It takes a couple of minutes to fill out the EIN form at the IRS site, and there is no charge for one -- see Link hidden: Login to view.

Most dropshippers or wholesalers who ask for a TIN/EIN are only doing so do dissuade lookie loos who don't know how easy it is to get one.


Frank


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fm1234
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28 Dec 13 07:35:17 pm
Some might ask for a reseller's permit, which is a state-level document issued in most states. You can easily find out how to get one in your state, and most are very cheap and easy to get. If you get a federal EIN and the supplier with whom you are talking wants a reseller permit, in most cases you will pass muster by providing the EIN and telling them the permit has been applied for.


Frank


"Failure is not when you fall down. Failure is when you don't get back up."

--J.J. Luna
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friendlyvender
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7 Jan 14 06:05:45 pm
Thank you fm1234

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ayurustam
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8 Jan 14 05:24:40 am
Hello everyone..
I am very new in Salehoo and the realm of selling online. When I went through the directory, I can see that most company listed requires us to have TAX ID. I don't have TAX ID because I'm not from US. I am wondering, am I going to face difficulties joining dropshipping programmes ?

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fudjj
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8 Jan 14 08:04:38 am
Hi Ayu and welcome to the forum,

You will find that it is mostly wholesale suppliers that will require a tax id, but dropshippers are usually fine. If you find that you do want to do business with a supplier that requires such, the best thing to do is to contact them and explain that you aren't in the US and see what the options are. If you have a tax id, business number or something like that from your country, that will often do.


Mark (fudjj)

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ayurustam
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8 Jan 14 02:03:24 pm
Thank you Marc for taking the time explaining this to me. Really appreciate it.

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fudjj
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8 Jan 14 08:10:36 pm
Anytime Ayu : )


Mark (fudjj)

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thebudgetbuddies
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9 Jan 14 07:32:16 am
I am also new to salehoo and feeling quite naked without a Tax ID. I have contacted several wholesalers regarding products only to be turned away for not having a Tax ID. I am just a small eBay/Amazon seller, what are the pro's/con's of having a Tax ID, and most important, What is it going to cost me?

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fudjj
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9 Jan 14 09:24:39 am
Hi Clayton and welcome to the forum

The advantages of having a tax id is the ability to deal with wholesalers, that gives you volume buying and cheaper prices per unit over a platform such as dropshipping. That of course gives you more opportunities to compete with other sellers.

In regards to what does it cost, well that kind of depends where you are really. Some places a tax id is completely free, some places will require a fee. You're best off speaking to your local authority/tax department about that one.

Cheers


Mark (fudjj)

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friendlyvender
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9 Jan 14 06:46:48 pm
Hello Marc,

I am trying to set tax rates in my Salehoo store and I just wanted to know if you have any experience with what I am about to ask you.

I live in Florida, so from my online store I would only collect taxes for people in Florida correct.

Just as how Accutech Data Supplies a Wholesaler on Salehoo needs to Tax ID information of people who want to resell in California.(And some other thing going on with Pennsylvania ) but nothing for all other states.

I already know the tax rate is 6% on goods in Florida but I just wanted to run this by you for anything that I may be missing.

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fudjj
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9 Jan 14 07:25:17 pm
Hi Vaughan,

That would be my exact impression of how the system would work in Florida as well, however I am always hesitant in handing out tax advice in areas where I have no personal experience. Even though I think you're right, I would always suggest calling your local tax department and just confirming everything with them first, can never be too sure lol

Cheers


Mark (fudjj)

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carattop
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10 Jan 14 02:58:37 am
I agree. Until the Marketplace Fairness Act (in case you aren't aware, there is a bill to be passed possibly) to start charging tax on transactions outside your state of business too but with threshold limits based on revenues. I think the proposal is $1M and above, so I dont care abt it at the moment :))

In the United States, currently you charge tax to the customer for online sales only if the sale is within the state of business (identified by shipping address being within the state of business). Same would be the case with Florida. But keep in mind, that Sales and Use Tax rates could vary. There could components of State Sales Tax at flat % value and then county and district level taxes.

For example for the State of Texas, I charge 8.25% split as 6.25% for the state and then 1% for county and 1% for some metropolitan blah..blah.. This info is important when you file your quarterly sales tax return where you will need to showcase the total value of your sales (in and out of state combined), taxable sales within state and then provide split on the calculation. Would you be penalized if the split isnt provided? As far as I know - NO. You would not be penalized as long as you pay the net value (which in my case is 8.25%).

I did a quick google search and found this link for Florida Sales Tax - Link hidden: Login to view

If you read carefully under sales and use tax, I quote from the page - "Sales and use tax rates: Florida's sales and use tax rate is 6%. Discretionary sales surtax (also called county tax) is imposed by many Florida counties and applies to most transactions subject to sales tax. The Department of Revenue collects both taxes and distributes the surtax back to the counties. The discretionary sales surtax rate depends on the county. Form DR-15DSS lists the counties and their rates."

Hope this helps!


Bharath Balakrishnan
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stancapriles
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10 Jan 14 09:39:52 pm
fudjj wrote:In regards to a TAX ID

What you will find is that typical wholesalers will require such, however dropshippers typically will not require it at all. So when you searching through the directory, anyone requiring such will most likely be a wholesale supplier, not a dropshipper.

If you want to deal with a wholesale supplier, then there is no way around providing a TAX ID.


Yes but I'm not a US citizen I live in the Caribbean And just joined today and now I'm reading this. Meaning if that's the case i can't sell on eBay. Am I right? And what now.

Stan

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fudjj
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11 Jan 14 02:31:18 am
Hi Stan,

You should still be able to deal with dropshippers, they usually won't require any tax id at all. If you do have a local tax id and want to deal with wholesalers, then my suggestion is to contact the wholesaler and explain that you are not a US citizen and would they accept your tax id. That usually isn't a problem, most will be happy to do so.

Welcome to the forum btw, nice to have you here : )


Mark (fudjj)

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