Idaho Taxes 12-Year-Old’s Fruit Stand: What This Means for Vendors

While other states are going after sales tax dollars from the likes of Amazon, Expedia, and Hartney Fuel Oil Company, Idaho is going after the kids. Recently, the Idaho Tax Commission put 12-year-old Tayson Weeks on notice: he has until October 15 to start charging tax on sales of raspberries at his road-side fruit stand. 

Minor penalties and interest

The Idaho Tax Commission visited Tayson in person to inform him of his obligation to collect tax during his second day at the fruit stand. He is selling berries over the summer to save up for a small motorcycle.

So what happens if Tayson decides not to comply?

There is every indication that Tayson and his family are complying with Idaho tax law. Says Jason Weeks, Tayson’s bewildered father, “The dollar amount isn’t huge, but it’s kind of a hassle.” He adds, “When I was young, I would sell farm-grown produce from a stand in Park City [Utah] and no sales tax was involved.”

Hypothetically, however, if Tayson refused to collect tax, standard practice would be to charge him penalties and interest on back taxes. (Tayson, If you’re reading, you can calculate your hypothetical penalties here.) Perhaps the Commission might decide to audit Tayson’s fruit stand. We can only imagine how awkward this could be once Tayson’s school schedule starts cutting into business hours.

What this means for vendors

Hypothetical tax scenarios aside, this story does have implications for many small vendors. According to Saul Cohen, tax policy specialist for the Idaho State Tax Commission, “What the youngster is doing is selling tangible products . . . Some people don’t know they’re retailers.”

In fact, most taxpayers in Idaho that make more than two sales of tangible personal property per year must collect and remit sales tax to the state. This means that if you sell at flea markets, farmer’s markets, roadside stands, food trucks, charitable events, or in front of your parents’ house, you may very well have to collect and remit Idaho sales tax.

Idaho taxpayers aren’t the only ones who have to worry about collecting sales tax on these types of sales. Here is just a sample of similar laws from other states:

• California and New York
  
• Mississippi 
  
• Texas
• Colorado

If you have to collect, go mobile

If you, like Tayson, discover that you have to charge sales tax from your roadside stand, market stall, or food truck, you certainly don’t want to spend any more time than you have to looking up finding the right sales tax rates for your location(s), especially in states where you have to worry about multiple taxing jurisdictions (state and local).

Luckily, there are mobile apps that will calculate sales tax for you. For example, AvaTax Rates uses geolocation technology to give you accurate sales tax rates no matter where you are. It is currently available for Android, iPhone and iPad, and you can use the technology on desktop here.

The best thing about the app? No age restrictions.

Read Tayson’s full story here.

photo credit: 401(K) 2013 via photopin cc