Doing business with USA member states

Taylor Evans82 said:You'll need an EIN for customs stuff.

That import tax ID (which is basically the same thing as your EIN but listed in the tax registry) is what you need if you want to bring goods in without paying sales tax upfront.

If you aren't registered for sales tax, you can still import goods from within the USA by paying the sales tax the supplier charges (up to a certain threshold), or you can register for sales tax and get an import ID specifically for that. Then, you'd just handle the sales tax on those specific import invoices yourself.

I have my EORI number, obviously, but I don't think I have this other one since I haven't had any reason to use it yet.

Let me see if I'm following correctly... I request that tax number and then I'm set. Now, the seller from the UK is already charging me sales tax. Does that mean I won't have to pay anything else once it arrives here?

edit: I figured out the first part. There is no way I'm registering for full sales tax.😁
So, how am I supposed to know what that specific acquisition threshold is?

restlesstiger102 said:I have my EORI number, obviously, but I don't think I have this other one since I haven't had any reason to use it yet.

Let me see if I'm following correctly... I request that tax number and then I'm set. Now, the seller from the UK is already charging me sales tax. Does that mean I won't have to pay anything else once it arrives here?

edit: I figured out the first part. There is no way I'm registering for full sales tax.😁
So, how am I supposed to know what that specific acquisition threshold is?

The threshold is $25667 and it covers your total acquisitions within the USA.

Just because you're hitting the limit for acquisitions doesn't mean your whole business is under the IRS umbrella. You just file for the acquisitions and pay our local sales tax. In that case, naturally, the seller won't be charging their own VAT.

If you don't have an international tax ID, the seller handles the VAT. It's really up to you to crunch the numbers and see which way saves you more cash!

PS. Sellers also have their own delivery thresholds (which vary by state here in the USA). If they cross that line, they have to register as a tax entity in California to collect our local sales tax (this applies if you aren't using your own international tax ID).

Taylor Evans82, thank you so much... everything is much clearer now. Could you just clarify one thing regarding what you mean by total acquisition cost?
Are we talking about imports spread out over a month or a year, or a single lump-sum import?

It seems more practical to just cover their local sales tax, especially since they are only charging 20%.🤔

If the seller is already including the sales tax in my invoice, if I am understanding this correctly, does that mean I won't have to file anything separately with the IRS?

I am asking because I would hate to make a pointless trip to the tax office tomorrow. If that is how it works, I can simply tell the vendor to include the tax, pay them via wire transfer, and consider the matter settled.

restlesstiger102 said:Taylor Evans82, thank you so much... everything is much clearer now. Could you just clarify one thing regarding what you mean by total acquisition cost?
Are we talking about imports spread out over a month or a year, or a single lump-sum import?

It seems more practical to just cover their local sales tax, especially since they are only charging 20%.🤔

If the seller is already including the sales tax in my invoice, if I am understanding this correctly, does that mean I won't have to file anything separately with the IRS?

I am asking because I would hate to make a pointless trip to the tax office tomorrow. If that is how it works, I can simply tell the vendor to include the tax, pay them via wire transfer, and consider the matter settled.

The threshold for acquisition and delivery is based on the calendar year.

As long as you aren't doing more than $25667 in imports from the USA (and remember, they count the total import amount, not just one specific vendor), it can be that simple! ;-)

Taylor Evans82, if that’s the case, then we have our answer. That annual figure won't exceed our projections, so there shouldn't be any issues at all.🙂

Everything looks great. My next step is simply to get the inventory ordered.🙂

Much appreciated.😘

Taylor Evans82 said:The threshold for acquisition and delivery is based on the calendar year.

As long as you aren't doing more than $25667 in imports from the USA (and remember, they count the total import amount, not just one specific vendor), it can be that simple! ;-)

They look at a two-year window. This year and the one before it. 😉

Henry Edwards33 said:They look at a two-year window. This year and the one before it. 😉

What exactly does that imply? Are we suggesting that the $77,000 figure is being split across those two years?

restlesstiger102 said:What exactly does that imply? Are we suggesting that the $77,000 figure is being split across those two years?

It isn't a split; you just aggregate the acquisitions over a two-year period.

Henry Edwards33 said:It isn't a split; you just aggregate the acquisitions over a two-year period.

The logic remains identical if the core issue is that you are effectively capped at a $77,000 limit over those two years.😳

If I’m a business owner with a registered tax ID, can I charge American sales tax to an individual in Germany who isn't registered for sales tax?
We usually ship our goods to Germany, but we've only ever dealt with clients who provided a valid tax ID. If I'm selling to a regular consumer instead, do I need to include any specific notes on the invoice?

Benjamin Palmer80 said:If I’m a business owner with a registered tax ID, can I charge American sales tax to an individual in Germany who isn't registered for sales tax?
We usually ship our goods to Germany, but we've only ever dealt with clients who provided a valid tax ID. If I'm selling to a regular consumer instead, do I need to include any specific notes on the invoice?

No, you just issue a standard invoice... including the sales tax, naturally...

Maybe someone on this thread can help me out with a quick question.

I’m looking for some advice regarding invoicing within the USA versus how I handle the IRS. I’d really appreciate any insight. It’s about an invoice being issued by an LLC that’s registered for tax purposes, specifically for consulting services.

I’m billing a firm over in Germany. Our contract specifies a gross fee, including this note: “All fees Quincy are inclusive of VAT if applicable and all other taxes. The fees will be paid gross.”

Since the tax for these services is typically paid in the recipient's country (in this case, Germany), my question is: am I actually allowed to show sales tax on the invoice I send to Germany? For example, if our agreed fee is gross $333, would I list the service value as $267 + $67 tax?

If I’m not supposed to show tax on there, how do I handle this given what's already written in my contract?

Thanks!

Benjamin Palmer80 said:If I’m a business owner with a registered tax ID, can I charge American sales tax to an individual in Germany who isn't registered for sales tax?
We usually ship our goods to Germany, but we've only ever dealt with clients who provided a valid tax ID. If I'm selling to a regular consumer instead, do I need to include any specific notes on the invoice?

I’m actually dealing with a pretty similar situation involving a private individual over in the UK. I use Synopsys software for my bookkeeping, and for individual customers, I issue a Form G invoice. Do I still need to fill out that ZP form? My hunch is probably not, since a regular person won't have a tax ID number to provide.
Also, does it make any difference if the goods haven't actually left the US yet? In this case, he bought items that are going to be installed in his house right here in America. Which address should I list on the invoice?

Thanks!

Does a taxpaying entity of ours operating within the USA have the option to settle transactions using cash if the amount exceeds $1.75 (based on its Euro equivalent), or is that specific ceiling strictly an internal regulation here in the States? I’ve actually consulted two different advisory firms on this, and they gave me two completely conflicting answers, so I was hoping to get your take on the matter.

Brenda Chase3 said:Does a taxpaying entity of ours operating within the USA have the option to settle transactions using cash if the amount exceeds $1.75 (based on its Euro equivalent), or is that specific ceiling strictly an internal regulation here in the States? I’ve actually consulted two different advisory firms on this, and they gave me two completely conflicting answers, so I was hoping to get your take on the matter.

Has anyone here dealt with this personally or perhaps heard of a similar situation? 🤷

Hello.

Here is my situation:
I have an opportunity to work for a foreign company. It would be a permanent, full-time remote role based out of my home here in the US, though I would travel to the UK as needed.

I need to know how payroll taxes work if this US-based firm pays my salary into an American bank account. Would the funds land in a standard checking account, or am I required to use a specific type of foreign currency account?
I assume the gross amount will hit my account first. What happens with Social Security, Medicare, and income tax? Am I responsible for reporting and paying these myself at the end of the year, or is there a monthly filing requirement?

Additionally, I am considering opening an account in the UK instead. I could then use that card to pay for things locally or withdraw cash from ATMs here or when I visit. If I go that route, how does the tax situation change?

Thanks.

So, we just got an invoice from Italy. Along with the actual goods, there’s this weird line item for $117—it says 15 units of some product at a price of 0.00, totaling 0.00. Basically, they're giving us 15 items for free because they were damaged in a previous shipment. How on earth do I handle this on the VAT return? Do I list it under Section II 7. without input tax, or does it go under Section III 3., or both? And does this even need to be recorded in the VAT registry? Help me out here!

Hi there!
I have a quick question for anyone here who handles business with Italy. We just received an invoice for some goods we had delivered, and both our tax ID and theirs are listed on it (we already double-checked their ID in the VIES database). No tax was actually charged, but instead of seeing the term "reverse charge," it says something in Italian: CONTRIBUTO CONAI ASSOLTO OVE DOVUTO. Does that mean the same thing, or is it technically required for it to explicitly say "reverse charge"?
Thanks!

The "reverse charge" note doesn't strictly have to be explicitly stated. As for that mention of the recycling fee... I suspect it’s tied to some sort of excise tax or environmental levy.

I'm looking for some expert advice here. How do I go about requesting a ruling from the IRS so that the import tax on goods from non-US countries
can be listed strictly as a calculation category (per Section 76, Subsection 8 of the VAT law; items II.15 and III.15 of the FORM)