Do I need to provide a Seller ID or TaxID for RunSignup’s sales tax system?
No. RunSignup files one consolidated sales tax return in Marketplace States using our TaxID. In nonMarketplace states, there is no need for RunSignup to ask for your SellerID since you are responsible for filing.
Does the sales tax come out of my race fee?
No. Sales tax is always calculated and added on to the other fees. For example, if your race fee is $30, and your state sales tax is 5%, then the charge is $31.50 plus the normal RunSignup processing fee. In states where the RunSignup processing fee is also taxed, it would be 15 cents more ($3.00 processing fee * 5%).
A race adds a correct address for their event but the taxability address is still invalid. What address should they enter at that point?
Use the closest valid USPS address to the race if their race address isn’t valid. Or they can use the business/organization or representative’s home address if it is in the same general location and uses the same zipcode. For more information, please refer to the blog on Sales Tax Address as well as the Sales Tax Webinar at about the 48 minute mark.
What if a race has multiple events in different locations (states)?
Because races are technically taxed in the location where they are held, these should be set up as separate races. The Alternate Registration URL can be used as an option to link the races all together on one landing page.
Virtual Races Questions
Where is the sales tax charged on Virtual Races?
Sales tax on virtual races will be calculated on the primary registrant’s address. It is highly unlikely that a virtual run would have 2 or more people in the cart with different addresses, but that is how we will calculate it on the checkout page.
How does RunSignup know it is a Virtual Race?
That is done by the flag set on a race in the Wizard setup.
Non-Marketplace State Questions
According to the Taxability Matrix it shows that I am in a non-marketplace state. What does that mean?
These are states where RunSignup is not yet required to collect and pay sales tax on behalf of our customers. In non-Marketplace states, each customer must decide whether to use our tax system to calculate based on the sales tax rules we implement for that state. For those races that turn on sales tax collection in a non-marketplace state RunSignup will calculate the taxes and charge registrants based on the items you sell on RunSignup and the taxability rules. We will remit the sales tax collected to you so you can file a return and pay the tax over to the proper taxing authorities. You can read more in our Sales Tax Policies.
Marketplace State Questions
Why is RunSignup collecting sales tax on my race?
There is a Marketplace Law in your state or in the states where your registrants live that requires us to collect and remit sales tax on your behalf. This makes it easier for all of our customers to comply with your state sales tax laws.
Will my state require me to pay the sales tax?
If your state asks for your organization to pay sales tax, you will be able to show them the Summary and Detailed reports on your Dashboard showing that sales tax was collected and paid by RunSignup starting in December, 2019. You will be responsible for any sales tax due before that time.
When you report, will you report my TaxID to the state?
No. We file an overall report across all of our customers for your state on a monthly basis beginning in December, 2019, or whenever your state passed a marketplace law.
I’m a nonprofit organization. How do I register my exemption?
First let’s be clear, if you have “buyers exemption” which exempts you from paying sales tax on purchases that is not the same thing as a “sellers” exemption. If you list a race on RunSignup you are a seller, not a buyer. However, some but not all states will exempt sales tax on items that you sell on RunSignup including registrations to your event and even merchandise (depending on each state’s rules). On your Dashboard sales tax setup, there is an ability to certify that you are eligible to take a nonprofit sellers exemption. This must be done in a state by state basis, as each state has different rules for taxing nonprofit events and merchandise sales. RunSignup has researched each state to provide the applicable sellers exemption for each state. The state law is cited in the dashboard, and you are responsible and liable for complying with that law.
Why do I have to send you my nonprofit information like your 990 report and IRS letter granting 501c3 status?
This is part of our normal process for validating exemption status.
Do I owe sales tax on race registration fees?
RunSignup does not provide tax advice, and Florida is not a Marketplace state so you are able to make a decision about whether or not you want RunSignup to help collect sales tax for your race. You should ask your tax advisor for advice. RunSignup’s sales tax system does calculate sales tax on the laws as we understand them. Florida does charge sales tax on race registration fees. However, there appears to be an exemption for races that also charge a spectator fee.
“This organization acknowledges that it qualifies for Florida Rule 12A-1.005(2)(i) because spectators are charged a taxable admission to watch participants of your event.”
You must acknowledge this in your Dashboard Tax Setup:
You can use RunSignup to set up a separate spectator event for a cost, or you can use a separate ticket platform or collect cash at your event. In any event, you are liable for implementing the rule properly for your race.
Processing Fee Questions
Why are some participants charged Sales Tax when others are not? My state shouldn’t be charging sales tax for registration (or I am in a non-Marketplace state and have not turned on sales tax).
RunSignup charges processing fees on all sales tax applied to a transaction. For example, on a $100 registration with a sales tax of 10%, the processing fee is calculated on $110, and would be $6.60 based on standard RunSignup pricing of 6%.
When the person signing up is using a credit card from one of the 7 states that charge sales tax on the processing fee, then the processing fee sales tax is also used as part of the calculation. Sometimes this takes a couple of cycles to accurately calculate. In the above example, there would be an estimated sales tax of $6.60 * 10% = $0.66, so the total processing fee would be estimated to be $110.66 * 6% = $6.64. The sales tax on the $6.60 would be $ 6.64 * 10% = $0.66, so the original calculation would be accurate. The transactions would show:
Registration Fee: $100
Sales Tax: $ 10.66
Processing Fee: $ 6.64
Total: $ 117.30