Tax Day
With the tax deadline here (April 18th is the deadline this year, see why here) a post about taxes seemed in order...
As an artist, one question you may have is whether you should charge sales tax for your work and what kind of registration is required. In Maine, businesses (be you a Sole Proprietorship, LLC, Corporation etc...) that buy and sell products are subject to sales tax. This means that whether you are selling art on the street or in a gallery, it is important to assess what your tax burden on those sales may be. Below are some links to websites that can provide you with more information.
The first is: http://www.maine.gov/online/businessanswers/howdoi/howdoi-9.html. This website provides you with a quick overview of when you need a Maine Tax ID number. The link on that page takes you to the Maine Revenue Service website which has the necessary applications for obtaining a Tax ID number.
On the Federal side of things, the IRS website provides information about whether you need a Federal Tax ID number (also known as an Employer Identification Number or "EIN"): http://www.irs.gov/businesses/small/article/0,,id=98350,00.html. Depending on your situation, you may or may not have to obtain one of these as well. There is a link on that page to a list of questions which can help you to decide whether you need a Federal Tax ID.A good overview why it is important for artists to think about sales tax is provided in the article:
SALES TAXES — A TRAP FOR UNWARY ARTISTS AND DEALERS
By Walter G. Lehmann
Lehmann Strobel PLC
The link to it is here
