Q:

How do you determine how much to charge in sales tax?

A:

Quick Answer

You can determine the amount of sales tax to charge by adding your state and local sales tax rates. Multiply the total sales tax rate by the cost of all items sold that are subject to sales tax, instructs the U.S. Small Business Administration.

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Full Answer

Check with your state government for a list of items that are subject to state and local sales tax. Wholesale items intended for retail sale are commonly exempt from sales tax. Raw materials produced and intended for use in the production of other goods are commonly exempt from sales tax. Sales made to nonprofit organizations are also exempt from sales tax, as stated by the U.S. Small Business Administration.

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