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Comission/taxes
Last post 08-12-2008 1:07 AM by Russ Nobbs. 1 replies.
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  • 08-11-2008 6:44 PM

    • LYILHA
    • Joined on 08-11-2008
    • Posts 1

    Comission/taxes

    My mother and I have recently started making a line of really awesome jewelry and they are flying off the shelves...we literally cannot keep up with the demand...which is awesome.  Our problem is that we are highly considering placing our pieces in a local store to market but we aren't sure what is a terrible commission rate and what isn't.  We found one place that is 60% for the artist and 40% for the shop, another that is 70%-30%.  Obviously of the two the 70%-30% is the better option.  The question I have is...is 70%-30% a typical rate or should we hold out for something better.  We really don't know what to expect here.

     We also considered placing our items on Etsy.com (which is AWESOME) but we are really unsure about how to do taxes and at what point should we do them...help?
     

  • 08-12-2008 1:07 AM In reply to

    Re: Comission/taxes

     60/40 is much more common than 70/30.  30% is a pretty small amount for the store to survive on. When stores buy outright they usually mark up at least 2x and some 2.5x and 3x.  Be sure to check out both stores well. A store with 60/40 may do a much better job of advertising their store and promoting your goods.

     There are 2 tax questions here. Income form consignment sales AND from etsy is part of  your gross sales for your business and is reported on your federal schedule C. You deduct expenses and pay income tax on any profit.

    Sales tax depends on your state. You only charge sales tax on direct sales to  customers in your own state. Check with your state department of revenue for exact details. If  you already have a resale number you are already registered with the state to collect sales tax.


    Each state has different tax requirements. Your City Hall, Chamber of Commerce or State Department of Revenue (Dept revenue) can help you.
    Here are some links to revenue departments in all US states. If one is not updated one of the others might be:

    http://www.bcfm.com/links/tax.htm


    http://www.taxadmin.org/fta/link/default.html
    (Also has info on movement towards a uniform sales tax system.)

    http://www.digital-women.com/state-tax.html

    This site lists information on "How to start your business in your state."
    http://jewelrymakinghq.com/state_busines_startup.htm

    This e-book  "The Ultimate Guide to Your Profitable Jewelry Booth" by Rena Klingenberg tells how to set up your business selling at craftshows. http://www.jewelry-books.com/jewelry-booth.html

    Signature
    Check out the Rings & Things 5 DAY SALE every other week.
    http://www.rings-things.com/sale

    -- Russ ( http://www.rings-things.com - Spokane, WA - USA)
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