Saturday, June 29, 2019

Are You a Wholesale Buyer and Retailer?

Here's a new little something to think about. 

Retailers buy at wholesale and sell at a profit. 


As an author, are you a wholesale buyer and retailer? If you are a self-published author purchasing author copies of your book that you then sign and sell at book signings and events you are. Do you have a sales tax number, resale certificate, wholesale tax-exempt certificate, or whatever the form may be called in your state? Every state calls them something different, if that state has a sales/use/vendor tax to be collected. If you do have one, have you provided it anew to Amazon so they don't charge you taxes on your author copies? If not, then you've been costing yourself money.

Let's look at KDP/Amazon. It can be an easy platform for publishing and getting copies for resale, but it is also a complicated structure when it comes to finding out where you fit in as a self-publishing author/vendor. If you look closely at your orders of author copies, since the change over from CreateSpace to KDP, you may find you have been charged taxes on those copies. You shouldn't be if you are going to be reselling them AND if you have the appropriate tax exemption certificate from your state. You probably filled out a form, maybe submitted a bond, when you first set up in your state to resell your books. Did you provide that information to CreateSpace earlier. The information may not have transitioned over when it changed to KDP.  

This question came up in the KDP discussion forums not long ago. You can read about it here if you're a KDP author. If you have not gotten a tax-exempt certificate for your state, do so. Once you have one, you need to check out the Amazon Tax Exemption Program (ATEP). There is wizard to walk you through the process. It is linked in the line of text, 

"To access the wizard click here." on their page.

We don't want to be taxing people twice. If you're paying the sales/use tax on your author copies at the time of purchase from the Amazon Marketplace, then should you be charging those taxes again when you resell them? That would be a good question for your State Department of Revenue to answer for you since every state has different rules. You should have already added their "contact us" email to your contacts list for easy access. I've had to ask questions from time to time and it's easier to find it in my contact list than it is to find it buried among multiple webpage links. It is worth your time to investigate this further.

You can read up on the discussion online. Here's one article I found that got me thinking. https://smallbusiness.chron.com/everything-need-getting-wholesale-license-12921.html