How do other markets handle the sale of convenience items (coffee, water, juice) or promotional items (shirts, tote bags, etc.)? Specifically regarding sales tax.
Call 1-800-225-5829 and ask the State sales tax office whether itfs taxable or not. If you eat it or drink it, itfs not taxable, however, if you serve it like in a restaurant, itfs a taxable service. If you have a non-profit, you should have a paper saying so. If not, you should have a sales tax number and be
collecting tax.
There seems to be an up-tick in audits of farm producers for sales tax liabilities. In addition to gift items such as bags and cookbooks, there
is actually sales tax due on the sale of horses to hobby riders! One
important piece of sales tax info for farmers' market vendors to know about
is the following: even if you owe no tax in a particular quarter of the
year (like, winter, when your farmers' market may be closed for the
season), you must still file a sales tax form to let them know that you
have no liability that quarter. Failure to file the form results in a
fine, even if you don't owe money.
If your total tax due is $3,000 or less for the annual period ending February 28, 2006 you can file a ST-101 ANNUAL return. If you qualify and want to make the conversion from a quarterly to annual return check out the following website - http://www.tax.state.ny.us/pdf/2006/st/st101i_206.pdf
I find the NYS Department of Tax and Finance pretty helpful on these matters
so just call the Sales Tax Information Center 1-800-698-2909. However,
when in doubt consult a tax attorney or CPA.
At the Cambridge Farmers' Market, Cambridge, NY we exist as a project of the Cambridge Valley Community Development and Preservation Partnership -CVCDPP Inc. The Community Partnership (for short) is a 501C3.
We have as a fund raiser canvas shopping bags, available as a "free gift" for a $10 donation. Each bag has inside a receipt for the donation which can be used at tax time. In order to distribute the bags and collect the funds we previously tried it at each of the vendorfs booths. What we had done was request that each vendor donate $20 and get 2 bags to display at their booth. They then could collect the $10 / bag or do as they wish, maybe give one to a favorite customer. They could then re-donate the funds and get more bags for display etc. This lasted about mid-season. However, this year we have them set up on one table located next to our Market Manager who is also a vendor. This seems to give us an opportunity to connect with the customer and explain what is going on and also explain how our logo came about. (Which, by the way we had a contest at the local school with the assistance of an art teacher to have one of their students design the logo.)
The sale of items especially coffee, juice, etc., just about any food item, for us, is an encroachment on the vendors territory.
Back to Frequently Asked Questions
