Reseller Sales Tax Guide 2026: Permits, Nexus, Resale Certificates & Collection Rules Explained

Disclaimer: This guide provides general information about sales tax for resellers and is not professional tax advice. Sales tax laws vary by state and change frequently. Consult a licensed tax professional for advice specific to your situation.

If you’ve ever sold something online and wondered, “Am I supposed to be charging sales tax?” — you’re not alone. Sales tax is consistently the most confusing topic for resellers, and for good reason. The rules vary by state, by platform, by whether you sell online or in person, and they’ve changed dramatically in the last few years.

Here’s the good news: for the vast majority of resellers selling on platforms like eBay, Mercari, and Poshmark, you probably don’t need to collect sales tax yourself. But there’s a related topic you definitely need to understand — resale certificates — because not knowing about them could be costing you hundreds or thousands of dollars a year on inventory purchases.

This guide covers everything you need to know about sales tax compliance as a reseller in 2026: resale certificates, seller’s permits, economic nexus, marketplace facilitator laws, when you do and don’t need to collect, and how to stay on the right side of state tax authorities.

This is a sales tax guide, not an income tax guide. If you’re looking for information about reporting reselling income on your tax return, 1099-K forms, or deducting business expenses, check out our 1099-K Tax Guide for Resellers and Reseller Tax Deductions Guide.

Let’s untangle the sales tax maze.

Sales Tax vs. Income Tax: The Critical Difference

Before diving into the specifics, we need to clear up the single biggest source of confusion for resellers: sales tax and income tax are completely different things.

Income Tax (Tax on Your Profit)

Income tax is what you owe the federal government (and most state governments) based on your net profit from reselling. You buy an item for $20, sell it for $60, and you owe income tax on the $40 profit. This is reported on Schedule C of your federal tax return. Platforms issue you a 1099-K to report your gross sales, but your actual taxable income is your sales minus your costs and deductions. We cover all of that in depth in our 1099-K guide and deductions guide.

Sales Tax (Tax on the Purchase)

Sales tax is a consumption tax — it’s charged to the buyer at the point of sale. When you buy a shirt at Target for $20 and the receipt says $21.40, that extra $1.40 is sales tax. The buyer pays it, and Target is legally obligated to collect it and send it to the state.

As a reseller, when you sell an item, you are potentially acting as that same tax collector. You’re not paying the tax yourself out of your profits — you’re collecting it from the buyer and forwarding it to the state. The seller is a tax collector, not the taxpayer.

Why This Distinction Matters

Many resellers mistakenly think:

• “I already paid income tax, so I don’t need to worry about sales tax” — wrong, they’re separate obligations
• “Sales tax comes out of my profits” — wrong, it’s added to the buyer’s total
• “If the marketplace charges sales tax, that counts as my income tax” — wrong, those are two completely different tax systems

Understanding this distinction is the foundation for everything else in this guide. Income tax is about your earnings. Sales tax is about every transaction.

Resale Certificates: Your License to Buy Without Paying Sales Tax

If there’s one section of this guide that could save you real money starting today, it’s this one. A resale certificate is arguably the most valuable document a reseller can have — and the majority of newer sellers don’t even know it exists.

What Is a Resale Certificate?

A resale certificate (also called a resale exemption certificate, tax-exempt certificate, or certificate of resale) is a document that allows you to purchase inventory without paying sales tax at the point of purchase.

The logic is simple: sales tax is meant to be collected once, from the end consumer. If you’re buying an item not to use it yourself but to resell it, that item hasn’t reached the end consumer yet. The sales tax will be collected later, when you sell it to the final buyer. Without a resale certificate, you’d end up with sales tax collected twice on the same item — once when you buy it and once when you sell it.

How It Works in Practice

1. You walk into a thrift store, retail liquidation outlet, or wholesale supplier
2. You present your resale certificate at checkout
3. The store removes sales tax from your purchase
4. You later sell the item and sales tax is collected from the buyer (either by you or by the marketplace platform)

That’s it. No sales tax on your purchase. The tax is deferred to the point of final sale.

Who Qualifies for a Resale Certificate?

Anyone with a valid seller’s permit (also called a sales tax license or sales tax registration) in their state can obtain and use a resale certificate. If you’re actively reselling — whether on eBay, Mercari, Poshmark, at flea markets, or through your own website — you qualify.

There is no minimum sales volume requirement in most states. Even if you’re a part-time seller doing $5,000 a year, you can register for a seller’s permit and get a resale certificate.

How to Get One

1. Register with your state’s Department of Revenue (or Department of Taxation, Comptroller’s Office, or equivalent — the name varies by state). This is usually done online, takes 10–20 minutes, and is free or costs under $25 in most states.
2. Receive your seller’s permit number. This is the number you’ll use on resale certificates.
3. Fill out a resale certificate form. Many states have their own form (for example, California uses Form BOE-230, Texas uses Form 01-339). Some states accept the Multistate Tax Commission’s Uniform Sales & Use Tax Certificate (MTC form), which is valid in about 38 states.
4. Present it to sellers when purchasing inventory.

Using Resale Certificates at Thrift Stores and Retailers

This is where it gets practical:

• Goodwill: Policies vary by regional Goodwill affiliate. Many Goodwill locations do accept resale certificates, but some don’t. Call your local Goodwill administrative office (not the store itself) and ask about their resale certificate policy. Some require you to register in advance.
• Salvation Army: Most Salvation Army thrift stores accept resale certificates. Again, policies may vary by region.
• Savers / Value Village: Generally accept resale certificates.
• Retail stores (Target, Walmart, etc.): These are less common for resellers, but they legally must honor valid resale certificates for items purchased for resale.
• Wholesale suppliers, liquidation pallets, lot sales: Virtually all wholesale and liquidation businesses accept resale certificates. Many require one before they’ll sell to you.

💡 Pro Tip: Even if a store cashier doesn’t know what a resale certificate is, the store is legally required to accept a valid one. Ask to speak to a manager. Some resellers carry a laminated copy of their certificate for quick transactions.

Critical Rule: No Personal Purchases

A resale certificate can only be used for items you intend to resell. Using it to avoid sales tax on personal purchases — buying a TV for your living room, clothes for yourself, supplies you’ll use and not resell — is tax fraud. States do audit this, and penalties range from back taxes plus interest to criminal charges for repeat offenders.

If you’re buying a mix of personal and resale items, separate the transactions. Use your certificate only for the resale items.

Multi-State Purchasing

Your home state’s resale certificate is generally only valid in your home state. If you travel to another state to source inventory, you’ll need to provide a resale certificate valid in that state. The MTC Uniform Certificate covers most states, or you can fill out the other state’s specific form using your home state’s permit number (many states accept out-of-state permits).

A few states — like Louisiana, Hawaii, and Illinois — have specific requirements about out-of-state certificates, so check before assuming yours is accepted everywhere.

The Money You’re Leaving on the Table

Let’s do the math. Say your state’s sales tax rate is 8% and you spend $12,000 per year on inventory (a modest amount for a part-time reseller):

That $800–$2,000+ per year goes straight to your bottom line. For full-time resellers spending $25K+ on inventory, a resale certificate can save thousands annually.

Use our Sales Tax Calculator to estimate exactly how much you could save based on your state’s rate and your inventory spending.

Seller’s Permits & Sales Tax Registration

A seller’s permit is the foundation of your sales tax compliance. It’s the document that authorizes you to collect sales tax, gives you the ability to use resale certificates, and puts you on your state’s radar as a registered business.

What It’s Called in Your State

States use different names for essentially the same thing:

Regardless of the name, they all serve the same purpose: registering you to collect and remit sales tax.

How to Register

In most states, registration is straightforward:

1. Visit your state’s Department of Revenue website (search “[your state] sales tax registration”)
2. Complete the online application — you’ll provide your name, business name (or your name as a sole proprietor), address, SSN or EIN, estimated sales volume, and what you sell
3. Pay any registration fee — most states are free; a few charge $10–$25
4. Receive your permit — online (sometimes instantly) or by mail within a few weeks

You do not need an LLC, a formal business entity, or a business bank account to register. Sole proprietors register using their SSN all the time.

The Five No-Sales-Tax States

Five states have no statewide sales tax:

1. Alaska — no state sales tax, but some local municipalities charge sales tax
2. Delaware — no sales tax at all
3. Montana — no sales tax, but some resort areas have a local sales tax
4. New Hampshire — no sales tax at all
5. Oregon — no sales tax at all

If you live in one of these states, you don’t need a seller’s permit for sales tax purposes (though you may still need a business license). You also can’t get a resale certificate from your state, though you can often use a certificate from these states when buying inventory in other states by claiming the items are for resale in a tax-free jurisdiction.

What Registering Obligates You to Do

Once you have a seller’s permit, you are agreeing to:

• Collect sales tax on taxable sales where you are the responsible party (more on when that applies below)
• File sales tax returns on the schedule your state assigns (monthly, quarterly, or annually)
• Remit collected taxes by the filing deadline
• Keep records of all sales and taxes collected

This is important: even if you make $0 in sales during a filing period, most states require you to file a $0 return. Failing to file — even a zero-dollar return — can result in penalties.

When Should You Register?

Most states technically require you to register before making your first taxable sale. In practice, many sellers register once they realize they should. There’s usually no penalty for late registration if you register proactively and start complying.

If you’re selling exclusively on marketplace platforms (eBay, Mercari, Poshmark, etc.), those platforms handle sales tax collection for you in virtually every state. You might still want to register for one primary reason: to get a resale certificate and save money on inventory purchases.

💡 Pro Tip: Even if you sell 100% through marketplaces and don’t need to collect sales tax yourself, getting a seller’s permit just for the resale certificate benefit is often worth it. The inventory cost savings alone justify the minimal effort of registration.

Economic Nexus: When You Owe Sales Tax in Other States

The concept of “nexus” determines which states you have a sales tax obligation in. This section matters most for larger sellers or those selling through their own websites.

What Is Nexus?

Nexus is a legal term meaning a sufficient connection between a business and a state that requires the business to collect and remit sales tax in that state. There are two types:

Physical Nexus — You have a physical presence in the state:

• You live there
• You have a warehouse, office, or storage unit there
• You attend trade shows, flea markets, or conventions there
• You have employees or agents there
• Your inventory is stored there (including Amazon FBA warehouses)

Economic Nexus — You exceed a sales threshold in the state, even without any physical presence. This came from the landmark 2018 Supreme Court decision South Dakota v. Wayfair, which allowed states to require out-of-state sellers to collect sales tax if they exceed certain thresholds.

Economic Nexus Thresholds

Most states have adopted economic nexus thresholds. The most common threshold is $100,000 in sales in the state during the current or prior calendar year. Some also use a transaction count (typically 200 transactions).

Here are the thresholds for major states:

Why Most Resellers Don’t Need to Worry About Multi-State Nexus

Here’s the critical point: marketplace facilitator laws (covered in the next section) mean that if you sell on eBay, Mercari, Poshmark, or other major platforms, those platforms track economic nexus for you and collect sales tax on your behalf in every state that requires it.

You only need to actively track multi-state nexus if:

• You sell through your own website (Shopify, WooCommerce, standalone site)
• You have very high sales volume in multiple states through non-marketplace channels
• You attend in-person events in other states

For the average reseller selling on marketplaces, this section is “good to know” but not something you need to actively manage.

Origin-Based vs. Destination-Based States

When you do need to collect sales tax, which rate do you charge?

• Origin-based states: You charge the sales tax rate of YOUR location (where the sale originates). This is simpler — you have one rate for everything. Examples: Texas, Pennsylvania, Ohio, Virginia, Arizona.
• Destination-based states: You charge the sales tax rate of the BUYER’S location (where the item is shipped). This is more complex because rates vary by city, county, and special tax districts. Examples: California, New York, Florida, Washington, Colorado.

Most states are destination-based, which is one reason sales tax compliance can be complicated for sellers with their own websites.

Marketplace Facilitator Laws: Why eBay, Mercari & Poshmark Handle Most Sales Tax for You

This is the most important section for the majority of resellers. If you only sell on platforms like eBay, Mercari, or Poshmark, you almost certainly do not need to collect, report, or remit sales tax yourself. Here’s why.

What Are Marketplace Facilitator Laws?

Between 2019 and 2023, nearly every state with a sales tax passed “marketplace facilitator” laws. These laws shift the responsibility for collecting and remitting sales tax from the individual seller to the marketplace platform.

Under these laws, the marketplace is treated as the seller for sales tax purposes. The platform:

1. Calculates the correct sales tax based on the buyer’s location
2. Collects the tax from the buyer at checkout
3. Remits the tax to the appropriate state and local tax authorities
4. Reports the tax on its own returns

You don’t do anything. The buyer sees the tax on their receipt, and the platform handles the rest.

Which Platforms Are Marketplace Facilitators?

As of 2026, the following major reselling platforms act as marketplace facilitators in all states that require it:

• eBay
• Mercari
• Poshmark
• Amazon (including third-party sellers and FBA)
• Whatnot
• Depop
• Facebook Marketplace (when using checkout/shipping)
• Etsy
• Grailed
• Kidizen
• Vestiaire Collective
• StockX
• GOAT
• Shopify (when using Shopify’s built-in checkout on Shopify Marketplace — note: your standalone Shopify store is different)
• OfferUp (when using shipping)

What This Means for You

If all of your sales happen through these platforms:

• ✅ The platform collects sales tax from buyers — you don’t need to
• ✅ The platform remits the tax to states — you don’t need to
• ✅ The platform tracks nexus thresholds — you don’t need to
• ❌ You should NOT manually add sales tax to your listing prices (this would double-tax the buyer)

💡 Pro Tip: If a buyer messages you on eBay or Mercari asking “Why was I charged sales tax?” — the answer is that the platform is required by law to collect it. You as the seller did not add it and do not receive it. It goes directly from the buyer to the state through the platform.

The Huge Misconception

One of the most common mistakes resellers make is thinking they need to:

• Add sales tax to their eBay listing prices
• Report sales tax collected by eBay on their own sales tax returns
• File sales tax returns in every state they ship to

None of this is correct. The marketplace handles it. The sales tax collected by the platform never touches your account and should not be reported on your sales tax returns. If you look at your eBay payout, you’ll notice the sales tax is not included — it goes directly to the state.

Where Marketplace Facilitator Laws Don’t Cover You

Marketplace facilitator laws only apply to sales through the marketplace. You’re still responsible for collecting sales tax on:

• Sales through your own website or standalone Shopify/WooCommerce store
• In-person sales at flea markets, swap meets, garage sales (above casual seller thresholds), and conventions
• Private/direct sales where you invoice through PayPal, Venmo, or Cash App
• Local pickup sales arranged outside of a marketplace platform’s checkout system

These are the scenarios covered in the next section.

When YOU Must Collect & Remit Sales Tax

While marketplace facilitator laws have eliminated the sales tax burden for the vast majority of reseller transactions, there are specific situations where you are the one responsible for collecting and remitting.

Scenario 1: Selling Through Your Own Website

If you run your own e-commerce site — Shopify, WooCommerce, BigCommerce, Squarespace Commerce, or a custom-built site — you are the seller of record. No marketplace facilitator is involved. You must:

• Collect sales tax in every state where you have nexus (physical or economic)
• Calculate the correct rate (including state, county, city, and special district taxes)
• Remit the tax to each state on the required filing schedule
• File sales tax returns in each state

This is where sales tax gets genuinely complex, and it’s the primary reason sales tax automation software exists (more on that below).

Scenario 2: In-Person Sales

If you sell at:

• Flea markets and swap meets
• Craft fairs and conventions
• Pop-up shops
• Estate sales you host

You are typically required to collect sales tax at the point of sale. Many flea market and convention organizers will ask for a copy of your seller’s permit before you can set up a booth. The rate you charge depends on the location of the event.

Scenario 3: Direct/Private Sales

If you sell items directly via:

• Facebook Marketplace local pickup (without using FB’s checkout)
• PayPal invoice or Venmo payment
• Cash transactions
• Direct Instagram or TikTok sales (without a platform checkout)

These are considered direct sales where you may need to collect sales tax if you have nexus in the buyer’s state. In practice, many casual one-off sales fall below enforcement thresholds, but technically, the obligation exists.

How to Calculate Sales Tax on Your Own Sales

1. Determine if you have nexus in the buyer’s state
2. Find the combined tax rate for the buyer’s address (or your address, in origin-based states) — use your state’s tax rate lookup tool or our Sales Tax Calculator
3. Add the tax to the sale price and clearly show it on the invoice or receipt
4. Keep a record of the sale, the tax collected, the buyer’s location, and the date
5. Remit the tax when you file your sales tax return

Filing Sales Tax Returns

Your state assigns a filing frequency based on your sales volume:

Most small resellers who need to file will be on an annual or quarterly basis. Your state will tell you your assigned frequency when you register.

💡 Pro Tip: Set a calendar reminder for your filing deadlines. Late fees and penalties are typically 5–25% of the amount due, plus interest. Even if you only owe $50 in sales tax for the quarter, a late filing can add $10–25 in penalties.

State-by-State Quick Reference

States With No Sales Tax

These five states do not impose a statewide sales tax:

Origin-Based vs. Destination-Based States

Origin-based states (you charge your local rate): Arizona, California (for in-state sales made by in-state sellers), Illinois, Mississippi, Missouri, New Mexico, Ohio, Pennsylvania, Tennessee, Texas, Utah, Virginia

Destination-based states (you charge the buyer’s local rate): Most other states, including Alabama, Arkansas, Colorado, Connecticut, Florida, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Jersey, New York, North Carolina, North Dakota, Oklahoma, Rhode Island, South Carolina, South Dakota, Vermont, Washington, West Virginia, Wisconsin, Wyoming

Major States: Sales Tax Rates & Filing Details

Key takeaway: every state in this table has a marketplace facilitator law, meaning eBay, Mercari, and other platforms collect sales tax on your behalf for sales in those states.

Sales Tax for Online vs. In-Person Sales

The rules for sales tax differ depending on how and where you sell, so let’s break it down by channel.

Online Marketplace Sales (eBay, Mercari, Poshmark, etc.)

Sales tax responsibility: The platform

As discussed, marketplace facilitator laws mean you do nothing. The platform calculates, collects, and remits. You list your item, price it normally (do NOT add tax), and the buyer sees tax added at checkout.

Your Own Online Store (Shopify, WooCommerce, etc.)

Sales tax responsibility: You

You must configure sales tax collection in your store settings, determine where you have nexus, set up the correct rates, and remit taxes to each applicable state. Shopify has built-in tax calculation tools. WooCommerce requires a plugin or integration with tax software.

Garage Sales and Selling Personal Items

Sales tax responsibility: Generally none

Most states have a “casual or occasional seller” exemption. If you’re selling personal items at a yard sale or occasional online sale, you’re typically not required to collect sales tax. This exemption applies to individuals who are not regularly engaged in selling — they’re just clearing out their closet or garage.

However, if you hold garage sales regularly (every weekend, for example), a state might argue you’re running a retail business and require a permit.

💡 Pro Tip: Selling your personal used items is also generally not subject to income tax unless you sell them for more than you originally paid (which is rare for personal belongings). This is the “personal loss” rule — you can’t deduct the loss, but you also don’t owe tax. Check our 1099-K guide for more details.

Flea Markets, Swap Meets & Conventions

Sales tax responsibility: You

If you set up a booth or table to sell items, you’re acting as a retail seller and generally need to:

• Have a valid seller’s permit
• Collect sales tax at the rate for the event’s location
• Remit the collected tax when you file

Many event organizers require proof of your seller’s permit before allowing you to vend. Some states issue temporary or event-specific permits for sellers who only do occasional events.

Local Pickup Sales via Facebook Marketplace, Craigslist, OfferUp

Sales tax responsibility: It depends

• If the sale goes through the platform’s checkout system (Facebook Checkout, OfferUp shipping), the platform acts as the marketplace facilitator and handles sales tax
• If it’s a direct local pickup with cash, Venmo, or PayPal, it’s a private sale and technically you may owe sales tax if you’re a registered seller — though enforcement on casual local sales is minimal

Record Keeping for Sales Tax Compliance

Good records are your best defense in case of an audit and your best tool for accurate filing. Here’s what you should keep.

Documents to Maintain

1. Copies of your seller’s permit(s) — keep digital copies accessible
2. Resale certificates you’ve presented — keep copies of every certificate you’ve given to vendors
3. Resale certificates you’ve received — if you sell wholesale and a buyer gives you their certificate, keep it on file
4. Sales records by state — especially for non-marketplace sales; record the date, item, sale price, buyer’s state, and tax collected
5. Tax collected and remitted — a running ledger or spreadsheet showing how much tax you collected each period and how much you sent to each state
6. Purchase records for tax-exempt buys — receipts showing purchases made with your resale certificate (showing $0 sales tax)
7. Sales tax return copies — copies of every return you’ve filed

How Long to Keep Records

• Federal IRS guideline: At least 3 years from the date you filed your return (or 6 years if there’s a question of underreporting income by more than 25%)
• State sales tax records: Varies from 3 to 7 years depending on the state. California requires 8 years. Texas requires 4 years. New York requires 3 years.
• Best practice: Keep everything for at least 6 years. Digital storage is cheap — scan receipts and keep organized folders.

Organizing Your Records

For most resellers, a simple system works:

• A spreadsheet or accounting app tracking sales by platform and non-platform
• A folder (physical or digital) for permits and certificates
• Exports from your marketplace platforms (eBay, Mercari, etc. all let you export sales data)

For more on organizing your financial records, check out our Reseller Accounting Software Guide.

Sales Tax Software & Automation

If you sell through your own website or have complex multi-state obligations, sales tax software can save you significant time and reduce error risk.

When You Need Sales Tax Software

• You sell on your own website with nexus in multiple states
• You sell at in-person events across several states
• Your annual non-marketplace sales exceed $50,000+
• You hate manual tax calculations and want it automated

When You Don’t Need It

• You sell exclusively on marketplace platforms — the platforms handle everything
• Your only non-marketplace sales are occasional local sales in your home state — a simple spreadsheet will do

Top Sales Tax Solutions

TaxJar (by Stripe)

• Automated calculation, collection, and filing
• Integrates with Shopify, WooCommerce, Amazon, eBay
• AutoFile feature submits returns to states on your behalf
• Starts around $19/month for basic plans

Avalara

• Enterprise-grade tax compliance
• Real-time calculation for complex multi-channel sellers
• Supports thousands of tax jurisdictions
• Better suited for high-volume sellers; pricing is higher

Shopify Tax

• Built into Shopify plans
• Automatic calculation for US sales
• Tracks nexus exposure based on your sales data
• Included with Shopify subscription (though some features require Shopify Tax Pro)

QuickBooks Sales Tax

• If you’re already using QuickBooks for bookkeeping, it includes sales tax tracking
• Automated rate lookup by address
• Filing reminders and some auto-filing features

Manual Tracking

• For single-state, low-volume non-marketplace sellers, a spreadsheet tracking sales, tax collected, and filing dates is perfectly adequate

💡 Pro Tip: Before investing in sales tax software, assess your actual need. If 95% of your sales are through eBay and Mercari, and you only do 20 local sales a year, you don’t need a $19/month subscription. A simple spreadsheet categorizing those 20 sales will take 30 minutes per quarter.

Common Sales Tax Mistakes Resellers Make

Avoid these costly and common errors:

1. Confusing Sales Tax With Income Tax

We’ve covered this, but it bears repeating: these are different systems. Your 1099-K and Schedule C are income tax. Sales tax is a separate obligation you may or may not have depending on how you sell.

2. Not Getting a Resale Certificate

This is the most expensive mistake. If you spend $10,000 a year on inventory and your area has an 8% sales tax rate, you’re throwing away $800 a year by not having a resale certificate. It’s free or nearly free to get one. There’s no reason not to.

3. Manually Charging Buyers Sales Tax on Marketplace Sales

Some sellers add sales tax to their listing prices on eBay or Mercari, not knowing the platform already collects it. This results in the buyer being double-taxed — they pay the extra amount in your price AND the platform-collected sales tax. This makes your listings overpriced compared to competitors and may even draw complaints.

4. Ignoring Filing Obligations After Registering

Once you have a seller’s permit, your state expects you to file returns on the assigned schedule — even if you had zero taxable sales. Not filing leads to:

• Automatic penalty assessments
• “Estimated” tax bills from the state (they’ll guess what you owe, and it won’t be in your favor)
• Potential permit revocation

5. Not Filing $0 Returns

If you had no sales in a filing period, you still need to file a return showing $0. Most states penalize non-filing more harshly than late filing with a balance.

6. Using a Resale Certificate for Personal Purchases

This is fraud. States audit resale certificate usage, and vendors can be required to provide records of who used certificates at their stores. Abuse of resale certificates can result in back taxes, penalties, interest, and criminal prosecution.

7. Not Registering in Their Home State

Even if all your marketplace sales have the tax handled by the platform, if you make in-person or private sales in your home state, you likely need to be registered and collecting sales tax. And again — registration gets you that resale certificate.

Frequently Asked Questions

“Do I need a business license to sell on eBay?”

eBay doesn’t require a business license to create a seller account. However, your state or city may require a business license or seller’s permit once your sales reach a certain volume or frequency. eBay will collect sales tax on your behalf regardless of whether you have a permit. The permit/license question is about your compliance with your local government, not eBay’s requirements.

“Does eBay/Mercari charge sales tax for me?”

Yes. eBay, Mercari, Poshmark, and virtually all major selling platforms now collect and remit sales tax on your behalf under marketplace facilitator laws. The tax is added to the buyer’s total at checkout and sent directly to the state. You do not receive the sales tax in your payout, and you do not need to report it or remit it.

“Can I use a resale certificate at Goodwill?”

It depends on your local Goodwill affiliate. Many Goodwill locations accept resale certificates, but policies vary by region. Contact your local Goodwill’s administrative or finance office to ask about their policy. Some require you to register in advance or set up a reseller account. Salvation Army, Savers, and other thrift chains generally accept them as well.

“Do I have to charge sales tax on Facebook Marketplace?”

If the sale goes through Facebook’s checkout system (the “Buy Now” / shipping option), Facebook acts as the marketplace facilitator and handles sales tax. If it’s a local pickup sale arranged through Marketplace but paid in cash or Venmo outside of Facebook’s checkout, it’s treated as a direct/private sale. Technically, if you’re a registered seller, you should collect and remit tax on that sale — but enforcement on casual local transactions is extremely limited.

“What happens if I don’t collect sales tax?”

If you were legally required to collect and didn’t:

• You may owe the un-collected tax yourself (the state can hold you liable for tax you should have collected)
• Penalties and interest will apply
• In serious cases, your seller’s permit may be revoked
• Criminal penalties are rare and usually reserved for large-scale intentional evasion

For marketplace sales, the platform handles this, so the risk primarily applies to non-marketplace sellers.

“Is selling personal items taxable?”

For sales tax: Most states exempt casual or occasional sales of personal items. If you’re selling your old couch on Craigslist, you don’t need to collect sales tax.

For income tax: You only owe income tax if you sell a personal item for more than you paid for it (a capital gain). Since most used personal items sell for less than their purchase price, there’s typically no income tax either. See our 1099-K guide for full details on how this works with 1099-K reporting.

“Do I need to register in every state I sell to?”

If you sell exclusively through marketplace platforms, no. The marketplace handles sales tax in every state. If you sell through your own website, you only need to register in states where you have nexus — either physical presence or sales exceeding the economic nexus threshold (typically $100K). Most small-to-mid-size resellers with their own sites only need to register in one to three states.

“What if I live in a no-sales-tax state?”

Living in a no-sales-tax state means you don’t have a home-state sales tax obligation. You benefit from not needing a home-state seller’s permit for sales tax purposes. However, if you sell on your own website and have economic nexus in other states that do have sales tax, you’d need to register and collect in those states. Marketplace sales are still handled by the platforms regardless of where you live.

Conclusion: The Bottom Line on Reseller Sales Tax

Let’s distill this entire guide into the key takeaways:

1. If you sell on eBay, Mercari, Poshmark, or other major platforms — you do NOT need to collect, report, or remit sales tax. The platform does it all under marketplace facilitator laws.

2. If you sell through your own website, at flea markets, or via private transactions — you likely need to collect and remit sales tax in states where you have nexus. Get a seller’s permit and file returns on schedule.

3. Get a resale certificate. Regardless of how you sell, if you’re buying inventory, a resale certificate saves you the full sales tax rate on every purchase. At 7–10% savings on potentially thousands of dollars in annual sourcing costs, this is the single biggest immediate money-saver in this guide.

4. Don’t confuse sales tax with income tax. They are separate systems. Handle each one independently.

5. File your returns on time — even $0 returns. Late filing penalties are avoidable and unnecessary.

Sales tax compliance doesn’t have to be overwhelming. For most marketplace sellers, the platforms have taken the hardest part off your plate. Your main action item is getting that resale certificate and saving money every time you source inventory.

Focus on what matters — finding profitable inventory and pricing it right. Use Underpriced to instantly check item values across eBay, Mercari, Poshmark, and Amazon, and our Sales Tax Calculator to see how much you’ll save with a resale certificate. For tracking deductions and COGS, check our Reseller Tax Deduction Calculator.

Happy — and tax-compliant — reselling!