Business Tip #13 for Writers: Sales Tax Exemptions

September 24th, 2012 → 8:00 am @

Our last tip dealt with sales tax, and and how good record keeping is essential to determine what tax you will owe on your sales. But there can be exemptions to sales tax. This is important for you, authors, as vendors to know! This short excerpt from my book, Business Tips and Taxes for Writers, outlines a few areas where you do not have to record sales tax:

“There are several circumstances where you can sell your books or products and not collect sales tax. The most common exceptions to sales tax are:

Selling to someone other than the end user. Generally, states only tax sales on the final user, so if you are selling your books to a bookstore or catalog, you do not charge them sales tax…

Selling to a nonprofit organization. In some states, nonprofit organizations are able to obtain sales tax exemption. These organizations should show you a sales tax exemption certificate from their state…

Selling to out-of-state customers. Usually, you must collect sales tax from customers that live in your state, but you do not have to collect sales tax from out-of-state customers. This principle is based on what is known as nexus. Nexus means to have a physical presence such as a store, office, employees, or salesman in that state. If you have a nexus in a state, you must collect sales tax in that state. No nexus, then no sales tax…”

Before disregarding sales tax for your writing business, make sure to do your research, writers. If you need any additional help in this area, pick up a copy of Business Tips and Taxes for Writers or drop me a line through my website. I’d be happy to help!

Carol Topp, CPA

2 Comments → “Business Tip #13 for Writers: Sales Tax Exemptions”

  1. Olga

    11 years ago


    I am reviewing your website as I am a new author and need all the help I can get, especially regarding sales tax and selling books. On tip #13 you write about collecting sales tax from customers that live in your state, but NOT from out-of-state customers.

    My question is I am a military dependent and we are currently living in Kentucky. However, we claim Texas as our home of record. SO, do we collect takes in the state we live in our the state on record as home?

    Thank you for any assistance,

  2. Carol

    11 years ago

    Sales tax depends on “nexus” or where you physically sell the books. In your case you sell the books from Kentucky, so you must collect and submit KY sales tax.

    Carol Topp, CPA