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Dynamic Sales Tax (US Customers)

US Sales Tax Update

This article is relevant to US customers only.

Table of contents

Overview

To comply with Marketplace Facilitator laws, GotPhoto calculates, collects, and remits state sales tax. This process began for all US photographers and their customers in March 2024. Learn more about the impact on manual orders created through the Order Entry page.


The Basics

GotPhoto’s automatic tax engine calculates sales tax based on your customer’s billing address and the nature of the item (digital, physical, or shipping). The tax engine supports state, county, and local jurisdictions.

This automated process requires no action from you and significantly simplifies compliance.

GotPhoto service fees are applied to the gross order total, including sales tax.

Each year, in January, you’ll receive a Form 1099-K summarizing the prior year’s earnings. This form will be available in your Stripe dashboard. You can read GotPhoto’s 1099-K FAQ or visit the IRS guide to Form 1099-K.

Note: GotPhoto cannot offer tax advice. Please consult a licensed tax professional.


Webinar Recording: US Tax Compliance (January 18, 2024)


Frequently Asked Questions

How will digital products be taxed?

If digital products are part of a package, tax is calculated by state rules — often at the highest applicable rate. A la carte digital items receive digital tax, while physical items receive physical tax.

Can I view reports on collected sales tax?
  • Sales Tax Report in the Statistics tab
  • Invoices Report under the Orders tab
  • Orders Report in each job’s Statistics tab
Does GotPhoto file my tax return?

No. GotPhoto remits taxes under its own accounts. You’re still responsible for filing your business's tax return.

What if I’m audited?

Consult your tax advisor. Revenue departments are familiar with Marketplace Facilitators. GotPhoto will respond to official inquiries as needed.

I'm in a no-sales-tax state. Will tax still be collected?

Yes, if your customer resides in a taxable state. The tax is based on the buyer’s billing address.

I am tax-exempt. What should I do?

Email your tax exemption certificate to tax-exempt@gotphoto.com. Once approved, “Tax-exempt status: Yes” will appear in your Tax Settings tab.

Note: Reseller certificates do not qualify. Previously charged taxes will not be refunded.

How are tribal/military tax exemptions handled?

We recommend consulting your accountant or state office. Orders delivered to tax-exempt addresses will not incur sales tax.

Can I still adjust sales tax in my account settings?

No. The Invoice Settings and Organization tabs no longer allow manual tax setup.

What if an unpaid order had sales tax?

Use the cancel button on the order page. GotPhoto will refund the collected tax to your account balance.

Do these changes apply to offline or cash orders?

Only Stripe Express orders are included. For manual Order Entry orders, you can choose to generate an invoice:

  • Generate invoice: GotPhoto collects/remits tax and invoices you monthly for it.
  • No invoice: You are responsible for any tax obligations.
Will customers see tax changes at checkout?

No significant change. Customers already enter addresses pre-checkout, and tax is shown based on that input.

How is tax handled on batch shipping orders?

Tax is based on each customer’s billing address.

What if I leave GotPhoto?

You must keep your account open to access your 1099-K. You may downgrade to a free plan if needed.


The Takeaway

GotPhoto simplifies US tax compliance by automatically handling sales tax on your behalf. Stay focused on photography while we manage the tax details behind the scenes. For any questions, reach out to your tax advisor or our Customer Care team.

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