This is a wide open question and I truly do want to hear from as many people in my blog community as possible because changes in the law are impacting what I can do online. (More on that below.) Ideally, I would love it if people would answer in the comments so people can build on and respond to what other people say.
In June 2018, the Supreme Court ruled in South Dakota vs Wayfair that states can require online businesses to collect sales tax, even if the product is digital. To make a very long story short, someone who sells digital goods online (such as myself) must now make sure he/she is in compliance with the laws in all 50 states.
Every state has a different law.
Every state has different expectations regarding what creates a nexus or a requirement to collect and remit sales tax.
Some require you to pay a fee and register. Some calculate qualifying transactions on a calendar year basis and some on a rolling twelve month basis. Some require monthly payments, some quarterly, and some yearly. Some will charge penalties if you don’t register according to deadlines so putting it off to wait and see what happens is a gamble. So everyone who sells on TPT (and/or their own site) is now required to keep track of everything and remit payments for all 50 states as needed.
In short, it’s a total nightmare and mess.
So this impacts the products I sell on my site and on Teachers Pay Teachers. I am having to look at everything I do online and decide what to do with all of it.
I do not sell enough product to hire someone to do this for me and the thought of dealing with this level of minutia for 50 states is absolutely depressing. I am not afraid of hard work and have worked hard since David and I became self-employed many years ago. But there is something about this tax situation that is simply soul-crushing. I don’t know how else to describe it.
So I am faced with closing my TPT store and then deciding what to do here with my shop. Some people are willing to take the gamble that everyone will get a waiver in the end and at some point a consistent law will be passed. I’m too much of a rule follower and like to sleep at night to roll the dice and hope it will all work out in the end. I don’t mess with the IRS or things related to taxes, especially when potential compounding penalties are involved. I’m not willing to run a business on a hope and a prayer.
The other option is to move toward a traffic based model on my site that is dependent on advertising. I can give away many of my products, but with the wide-spread use of ad blockers, I would have to require people to turn off their ad blocker to access my site. I would be happy to do this if I could replace the income I received from selling the items. In some ways, I would like this better because that would mean I could offer my products to people who truly can’t afford them but can “afford” to turn off their ad blocker. I know from surveys that there are many people who like my products but truly can’t afford to buy them. This would enable me to help those people.
These are the unintended consequences of making laws. People with large sites and large stores will hire professionals to help them. People with tiny stores will just close them down and move on. It’s the “middle class” of this country once again who will take the hit. The people who work hard to improve their life and the life of their family, but will pay the price due to laws made by people who have no idea what it is like to be a regular person trying to live a regular life in regular America.
So I’m sitting here and asking myself if this is all worth it. I spend a lot of time on this site. More than most people probably realize. I spend a lot of money every month to keep it running effectively. What do I do now to make it worthwhile? How do I replace this lost income that my family depends on?
So that’s why I’m asking you today…
- What do you want to see here in the coming twelve months?
- Which big topics?
- What would you like to see more of?
- What specific products could I make that would help you with your homeschooling, homemaking, faith, etc?
- If I made more of my current and future products and planners free but required you to turn off your ad blocker to access them, would you find that a worthwhile trade-off?
Thank you for any feedback you can provide.