So I started an online shop this year on Shopify selling clothes as a hobby and to see if it would work. I have made $1000 Gross in sales and collected about $80 in sales tax for NY as I am in NY.

I thought that I had registered to collect sales tax and make sales in Shopify but now realize I needed a Certificate of Authority to collect sales tax and am freaking out because the penalty is up to $10K. (I now know I missed about 2-3 quarterly deadlines to remit sales tax so I’ll have to pay a fee of about $100-$300 which is okay). I now have the Certificate of Authority as of 2 weeks ago.

A CPA told me that NY is pretty strict, so I will essentially have to pay this huge fine, is there any way I or he can call or something to avoid the $10K fine? Can I ask for a payment plan if there is no other way? Please let me know or if anyone has been in this situation before! I just want to do it right, this is a very tough lesson for me as this will wipe out my savings if there is nothing I can do…

Thank you

  • badIuckbrotherBEnglish
    1·
    10 months ago

    You’ll have to pay penalties and interest for failure to file and pay sales tax.

    These penalties vary by state, but in general you can assume that penalties and interest will roughly total 30% of the amount of sales tax due. For example, if you owe $1,000 in sales tax, on average you will owe around $300 in penalties and interest.

    You may be subject to criminal penalties if you showed intent to defraud the state.

    This one is pretty rare, and hopefully doesn’t apply to your situation. But if you are involved in a sales tax “cover-up”, the states will not look favorably on your case.

    ​

    according to this I don’t think you show intent to defraud the state and you don’t have to pay 10k in fines but please do your due diligence