First, sales tax is collected only when your client is in the state you have a physical presence.
IF PA changes sales tax on this type of service, then the amount is the rate X the amount of the sale.
For example, some states charge sales tax on various services, say a haircut. If one one place charges $10 (and the rate is 7%) then the tax is 70 cents. Down the street, one may pay $30 for a haircut and the tax is then $2.10. The point is that the value of the service is the price paid and that is what is applied to the tax rate.
You could produce the same service (art) for the same client but if the client pays $1000 for the first one and $900 for the second, the $1000 and $900 are the values used to collect sales tax.
So, the big question for you to research is if the service of creating digital art is taxable in any state you have an actually physical presence. If it is, then you must collect sales tax when you sell your services to a client also based in PA.
New Topic
Post Reply
Follow Topic
