Selling Digital Items/Designs
I'm a graphic designer looking to sell custom digital items, i.e. business cards, invitations, menus, and so on. The tax issues are honestly mind boggling after reading so many pages and articles, although Reddit has been pretty helpful.
My questions include: Do any of the tax rules for New York apply for these digital items? Also, many designers on Etsy I've seen sell their custom designed invitation as a physical item, meaning it has no shipping applied. This is opposed to listing as a digital download or a template that the customer can download and customize. The purpose of the physical items is so that the buyer just sends in a name, date and location, the designer plugs in information in their design and sends it back to the buyer. Deal done.
Would any of the tax requirements for NYS apply to a shop described as above? I'm in Albany County and am reading conflicting things, but what kind of time and money goes into obtaining a sole proprietorship, COA for collecting taxes and/or whatever else is necessary to sell (at least I predict at this point) under a few thousand dollars worth of goods? I understand from a couple years ago I did a freelance gig on the side and made under $400 and my tax service said there's no need to apply for any business license. Is this also the case with Etsy as I'm just testing the waters?
Posted Jun 16, 2017, 7:40 PM UTC