Buying at coin shops bad for your wallet?

I live in Southern California and I pay 8.75% sales tax on all purchases at coin shops. ($1,500 and above is tax free) I used to think Ebay was overly expensive, but I realized I was comparing Ebay prices to my reciepts while not including the tax I paid. After including tax I realized I am spending close if not sometimes MORE than Ebay. I know that there's no tax at coin shows but I'm really only limited to 2 or 3 of those a year. I can go to coin shops as often as I like, but I pay for it in tax. How do you guys purchase the majority of your collection? Am I wasting unnecessary money not waiting for shows?

 

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Options
1. Find a place that will not charge you sales tax under $1,500
2. Wait until you have $1,500 to spend at once
3. Wait for a coin show(see option 1)

 

Simple. Offer a price that's 9% lower.

If they want $200 for a coin, offer $182.

If they accept, then you just saved yourself sales tax.

 

If you live close to a border state know if this coin tax also applies. I am currently working in Missouri where there is no coin tax. But if I cross the river into Kansas where coin taxes does exist. Also I would recomend a pawn shop. I have boughten coins from war nickels to some mexican silver coins at spot or bellow spot from un-knowing pawn shop dealers who want a quick sale. I also check on craiglist but be very careful.

 

I purchase the majority of my coins on ebay or CT members, however, my best coins I purchased from the LCS. It really depends on the coin. The basics from ebay, the good stuff from a trusted source - LCS.

 

If you live in a state that taxes, you must remember that no matter how you purchase,
whether it be at a B&M, eBay, show, out of state or by mail order, you are still liable
for the payment of such tax.
If I'm not mistaken, eBay is now adding Cal. sales tax to purchases delivered to Cal.

People used to by cigarettes from the Native American tribes to avoid sales/tobacco
taxes in their states. The feds finally stepped in to stop those sales. No more credit cards
for payment or UPS, Fedex, USPO delivery of cigarettes. The tribes have to report sales to the
individual states.

 

In Georgia you do not pay taxes on Numismatic things at shops. I know at the shows I do not.:smile

 

This is absolutely true. The other options is to move to a state without sales tax...like Oregon. Of course, our income and property taxes more than make up for it.

 

Even though you may feel that you're overpaying due to taxes, you have to see things from another point of view.

At a store you can see the coin up close and hold it before you make the purchase. This outweighs all images on ebay or any other site. You also take less risks of not receiving your items or getting a seller thats trying to pull a fast one on you. Sure, there are lots more coins on ebay but nothing is better then seeing the actual coin before you buy it.

 

In Nevada, it is the proprietor that is responsible for paying the sales tax.

 

Is this a tax that law requires be added to the list price or can this tax be hidden in the list price.
I'm thinking that, like other states, the seller is required to collect such tax from the buyer and remit it to the state. If that is the case, if the seller doesn't collect the tax, he is in violation of the law, but the buyer is still required to remit the tax to the state himself.

 

Great point, that definatley is a plus buying at a shop.

 

Nevada.
From http://tax.state.nv.us/About taxes and Faqs.html#stinfo

Overview:
Use Tax, the counterpart of Sales Tax, is imposed upon the storage, use or other consumption in this State of tangible personal property purchased from a retailer. Use Tax is not imposed when the sales of the property to the consumer is subject to the Sales Tax. For the most part, Use Tax rather than Sales Tax, applies to property purchased ex-tax outside of Nevada for storage, use or other consumption in Nevada from other than a seller registered in Nevada. Use Tax, applies to mail order, out-of-state, toll-free “800” numbers, purchases made on the internet and other purchases of tangible personal property on which Nevada Sales Tax has not been paid

Who is Affected?
All taxpayers.


I think it could be successfully argued that 'other purchases' made within the state but not having tax paid would fall under the use tax law.

 

In California, local sellers are required to either collect the sales tax from the customer, or if included in the price state that on the invoice. The seller is responsible for paying the the amount to the State. But, when a person who lives in Ca buys something online from another state that doesn't charge residents of Ca tax, the buyer is responsible for paying "use tax" to California, equal to the local sales tax rate of the buyer. So when people say they don't pay tax because they buy online, they are technically breaking the law. In California at least.

 

I think that is when something is sold to a re-seller. Also, I like that bit about the use tax that it would apply to internet sales.

 

Breaking the law, hmmm . . . reminds me of a really cool song.

 

Best bet is to spend alit if time at one or two of the better shops and get to know the dealer. This may eventuly get you price breaks a a regular.

Most of mine come from Heritage or a small handfull of trusted dealers. I have 5 national dealers on speed dial. I have 3 that run want lists. My local shops occasionally has stuff I'm interested in, but if I were to depend on them I would get nowhere in a hurry. Even local shows produce very scarce pickins. That's the trade off when you get fussy on specialty series.
Also Teletrade, Dlrc, great collections. I've bought maybe 10 pieces off of flea bay in the last 3 years.

 

I think you will find that he is responsible for remitting the sales tax to the state. He can either collect the tax from the buyer or pay it out of his profit margin. Either way the tax gets collected and paid.

People in Nevada who buy stuff from out of state are supposed to pay use tax to the state on the items they purchase. If they buy something in Nevada and they don't pay the sales tax, and the seller doesn't pay it in theory they would probably be responsible for paying the tax, either as sales or Use tax, but the state would probably go after the seller because it is his responsibility to send it in to the state whether he collected it or not.

If the show is in a state that has a sales tax on coins they are SUPPOSED to be charging the sales tax at the show. Many dealers don't collect the tax though and don't send it in to the state. They are committing the crime of tax evasion.

When something is sold to some one with a valid resale license, ora non-profit, sales tax is not collected, but the sale and the re-sale license number or non-profit tax number do have to be recorded. If you claim a non-taxable sale and you are audited you have to have the tax number to go with that sale. or YOU will be required to pay the taxes on that sale. And if there is a pattern of such cases you can be charged with tax evasion. The fact that taxes are not collected at many shows where they should be collected is a matter of lax enforcement, not a case of not having to collect it. In the past there have been times of stepped up enforcement with tax collectors being present at coin shows to make sure the law is being observed. But since tax collectors tend to work Mon-Friday 8:00 - 4:00 and really don't want to have to go out and work Friday afternoon, let alone on the weekend, coin shows tend to slip under the wire.

The real problem with sales tax, especially in California is nexus. If you are located in another state but say have an office in California, you are said to have a nexus or business presence there. And as such you are required to collect California Sales Tax on all items sold to residents of California and shipped there, and to remit the taxes to the state. Several years back the State tried to reduce the number of days that an out of state vender could come into California and sell without a nexus being created. They lowered it to something like four days a year. Do more than two shows a year, or one long show, and you now have a CA nexus and have to start collecting CA sales tax on all sales made in or to residents of CA. This was so disturbing that an ANA convention scheduled for CA was canceled just a few months before it was to be held and moved to another state. And it was several years before a site in CA would even be considered. (In the meantime the number of days before nexus was established was increased. I imagine CA discovered they were losing a lot of convention business and all of the other income that came from them. Instead of raising revenue the small number of days to establish nexus had actually reduced income.)

 

i am still not used to people saying they have to pay sales tax on coins/bullion, but can you not go to a flea market or something to avoid sales tax?

 

Of course people can, but you can't really compare the overpriced and inadequate selection of coins and bullion at a flea market to coin shops and coin shows.