Q: Do I charge a New York State Sales Tax on a 50% Deposit Payment
I will be selling a product as a Pre-Order, buyers will need to make a deposit payment of 50% of the retail price. Do I add the New York State Sales Tax on the deposit invoice or is this done at the end when the final remaining 50% is paid? Buyer will receive a Deposit Payment Invoice and the Final Invoice at the end when the product ships. Any help would be appreciated, thank you!
A:
if you are on the accrual method, you will generally record the sale when it is made. In that case you should collect sales tax at that time.
If you are on the cash method, you should collect sales tax as you receive payments.
Generally, NY wants sales tax when the customer takes possession.
You should speak to an accountant for best practices on this issue.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
