Sales tax can affect your orders depending on where they’re fulfilled and shipped. In the US, sales tax rules vary by state, and whether or not you’re responsible for collecting and remitting it depends on what’s known as a “nexus,” which is essentially a connection between your business and a state.
This article explains how sales tax works, when you’re responsible for it, and what you can do to avoid being charged sales tax on your Printful orders.
What is sales tax?
Sales tax is a state-governed tax that applies to orders fulfilled and shipped within the US. Since it’s managed at the state level, each state has different rules about how sales tax is calculated, collected, and reported.
When do I need to collect and remit sales tax?
You’re required to collect and remit sales tax in states where you have nexus. Nexus means you have a significant presence in a state, and it can happen in a few different ways:
- You have a physical location in the state (even if it’s your home office).
- You reach a sales threshold set by that state, even if you’re not physically located there.
If you have nexus in a state, you’ll need to:
- Register for a sales tax permit in that state.
- Collect sales tax on orders shipped to customers in that state.
- Remit the tax to the state tax authority.
Will I be charged sales tax by Printful?
Yes, you’ll be charged sales tax on orders that are fulfilled and shipped within the US, based on the delivery address of the order.
However, if you’ve submitted a valid resale certificate for a state you’re selling to, we won’t charge you sales tax on orders going to that state.
What is a resale certificate, and how do I submit it?
A resale certificate shows that you’re buying products to resell to your customers, which makes the purchase tax-exempt. You can get a resale certificate after registering for a sales tax permit in a state.
Many states accept "out-of-state" resale certificates, which means one certificate might work for multiple states. But a few states don’t accept these, so you’ll need to register separately in those cases.
Once you have your resale certificate:
- Go to Billing settings in your Printful Dashboard.
- Upload your resale certificate under Tax information → Resale certificate.
- We’ll review your submission.
After it’s approved, we’ll stop charging you sales tax for orders going to those states.
Learn more about submitting a resale certificate in our guide