According to Us Sales Tax laws, we need to charge sales tax on the goods delivered to a customer in the merchant's name, in all states where Spreadconnect is registered.

Sales tax will only be visible on the invoice from Spreadconnect to the merchant. It is the merchant's responsibility to verify whether they are able to charge those sales taxes directly to the customer.

For some states, the merchant can provide Spreadconnect with a sales tax exemption form so we can stop charging those taxes for you. 

A resale certificate allows retailers to purchase products without paying sales tax if they plan to resell those products. This is applicable only for merchants who have their items produced in North America.

How to Apply for a Resale Certificate

To obtain a resale certificate, follow these steps:

1. Obtain a Sales Tax Permit: You must have a valid sales tax permit.
2. Apply for Certificates by State: Apply for a resale certificate for each state where you conduct business.
   • You can streamline this process by using services such as Streamlined Sales Tax to apply for multiple states at once.

Since Spreadconnect acts as the seller, you must include the following details about Spreadconnect when applying for your resale certificate:

Seller Information:
Spreadshirt Print On Demand GmbH
Giesserstraße 27
04229 Leipzig, Germany

Submitting Your Resale Certificate to Spreadconnect

If you already have a resale certificate for states where Spreadconnect charges sales tax, you can submit it to us. Once approved, Spreadconnect will stop charging sales tax for applicable products.

1. Log in to your Spreadconnect account.
2. Navigate to: Account Settings > Taxes > Resale Certificates > Manage Certificates > Upload Certificate.
3. Upload the document.

• Spreadconnect will verify which product categories are exempt. Sales tax may still apply to categories not listed on your certificate.
• Processing Time: Certificate verification typically takes 2 business days.
• You can track the status of your submission in the Spreadconnect app.

Key Points to Check Before Submission

Ensure your resale certificate meets the following requirements:

• It is a resale certificate, not a tax registration form.
• The seller's address matches:
  Spreadshirt Print On Demand GmbH
  Giesserstraße 27, 04229 Leipzig, Germany.
• The address on the certificate aligns with the one in your Tax Profile Information.
• Your Tax ID is clearly listed on the document.

The sales tax is calculated on the production and shipping costs of your order. This means it is based on the amount you pay to Spreadconnect for production and shipping—not the price you set for your customers.

Sales tax for your orders is calculated based on a combination of factors, including:

• The product being sold.
• The destination of the order.
• Tax holidays and other state-specific exemptions.

Spreadconnect partners with Avalara, a trusted tax compliance platform, to ensure accurate tax calculations. Avalara automatically applies the correct tax rate and amount based on the latest regulations.

When is Sales Tax applied?

Sales tax is applied only if the customer's shipping address is located in one of the states where sales tax is required. View the list of applicable states here.

Additional Resources

For detailed guidance on sales tax rules, rates, and exemptions, refer to Avalara’s article: How to handle sales tax on shipping: A state-by-state guide

List of states in which sales tax charges apply and are charged by Spreadconnect:

Sales tax is not included within the product costs that are visible during the product creation process or in our product catalogue. As tax varies by state, city, or even district, the sales tax is always added on top of the product costs after an order is made.

Sales tax can only be calculated after the order has been placed with Spreadconnect and therefore it is only visible on the order detail page and the invoice. 

For some states, the merchant can provide Spreadconnect with a resale certificate that will enable Spreadconnect to drop the sales tax charge.

This is unfortunately not a question we can answer for you. We highly recommend talking to a tax advisor before you take any decision, as not all cases are the same. For some more information on the topic, we can recommend the tax resources from our partner Avalara:

https://www.avalara.com/us/en/learn/guides/frequently-asked-questions-for-getting-started-with-sales-tax-compliance.html

Regardless of where you are located, we will charge sales tax if the customer's address on the packaging is located in a state where we are registered. 

The location of you as the merchant does not play a role in whether or not Spreadconnect charges sales tax on the transaction. 

If you’re not located in the USA but are selling to customers in the USA, then you may or may not be liable to charge your customers' sales tax. We highly recommend talking to a tax advisor. You should check carefully whether you need to charge sales tax before making a decision.

For some more information on the topic, we can recommend the tax resources from our partner Avalara: https://www.avalara.com/us/en/learn/guides/frequently-asked-questions-for-getting-started-with-sales-tax-compliance.html

Since each state differs in their tax legislation, it depends on where you’re delivering to, but also what kind of goods you are selling. It can be that some products from the Spreadconnect assortment, for some states, are tax-free, whereas other products in the same state are subject to tax. 

Our tax partner Avalara has compiled more information on tax exemptions here: https://www.avalara.com/us/en/learn/whitepapers/sales-tax-clothing-industry.htm 

Below you can find a list of the most common reasons why a resale certificate was rejected.

Important: The most common reason for certificate rejection is a mismatch between the address or company name on your certificate and the details listed in your Tax Profile Information. If your certificate information doesn't match, you can update your Tax Profile at any time to ensure consistency.