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I Forge Iron

Sales tax


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On 12/21/2019 at 12:43 AM, George N. M. said:

I've never had anyone give me a tip except to say "keep the change." 

that 'keep the change' always bring to mind the movie, "Home alone" where he uses and old gangster movie to scare the burglars ... what does the guy say? ... "Keep the change you filthy animal, ha ha ha ha. " 

Anyway, that is just me :)

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Concerning a tax licence, in Colorado there are two choices, you can get a tax license or not. If you opt for a license you don't pay taxes for your materials and you charge tax on your sales. You also file quartly with the government. If you opt for no license you pay tax on your material and no tax on your sales. Most of the fairs I attended collected tax at the end of the day.

For me, not filing quartly was best.

As far as crafts fairs, I was not a professional crafts fair blacksmith. I did a few a year and my  purpose was advertising both my business and creating an awareness for my craft. I always demonstrated.I always made expenses including my family's purchases and food. I believe my demonstrations did far more good creating an awareness for our craft than generating  sales. 

As a general rule, there are fairs for the general public and fairs for wholesale buyers. The former are for fun, the latter are for making a living.

I rarely charged for demonstrating altho the fairs I attended didn't charge fees if you demonstrated. The exception for this was the Colorado Council for the Arts gave me a grant if I demonstrated at fairs of their choice around the state. This was a mixed blessing and lasted two or three summers.

I have this strange philosophy that not charging to demonstrate fulfills my belief in passing on my knowledge to advance our craft. 

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We have three separate businesses. Two are service businesses and s-corps, which means a lot of things but aren't really relevant for George N.M.'s OP.

The third business is an LLC for our apiary and lavender farm. Products created or this business (honey, beeswax stuff, lavender essential oil and hydrosol, cutting boards and other woodworking items, and soon metal stuff) may or may not require us to charge sales tax for retail sales because of state and local (county and city) regs.

For example, we do not need to charge sales tax for honey, but we do need to charge sales tax for lavender essential oil.

We handle this by figuring out our pricing, adding the sales tax and rounding, and paying the sales tax out of gross. Yes, this makes making change easier (though most people use plastic now, so we use Square) but mostly it helps the customer. We get a lot of people wanting to buy our products as gifts and they have a budget, say, $20 per person. That's two jars of honey, or a jar of honey, a bottle of hydrosol, and a bar of handmade beeswax soap, or whatever combination they want. They know what they're spending as well as what they're getting.

No one has balked or argued or anything, ever. We make it very clear through signage what everything costs, we don't haggle, and we don't discount. That allows us to focus on giving samples and answering questions, which we get a lot of because we're beekeepers and everyone has an opinion about bees. This is also very much on brand for the business.

We have a state UBI and federal tax ID numbers, and if we're selling at an event in a city that requires a city business license, we get one.

Hope this helps.

P.S. With the two s-corps, we each operate one and may or may not add a PITA percentage when asked to estimate or bid on something, and that depends on the project, the project manager, how busy we are, how much we want to do the project, etc. You don't usually want to come right out and say no, so you ask for an outrageous amount of money. The problem is when the client says, okey-dokey and you're stuck doing a project you really don't want to do. But that's another story for another time.

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On 12/21/2019 at 11:54 PM, jlpservicesinc said:

I usually look like i just woke up from sleeping in a gutter.  All dirty and hair all messed up..  sometimes I even have lipstick smeared across my face..    i think it's a pity thing.. :)

Do you get more tips looking that way? 

I wonder if I can try the lipstick trick ... :P

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