The Reseller Index
Sponsor Your logo here: sponsor a week

Taxes / Seller's permits by state / Texas

Do I need a seller's permit to sell on eBay or Poshmark in Texas?

Yes if you live in Texas: the Comptroller says a Texas seller who sells only through a marketplace that has certified it collects the tax still has physical presence in Texas, must have an active sales and use tax permit and must file returns on time; a remote seller selling only through such a marketplace doesn't need one. Direct sales (your own site, flea markets, craft shows) are covered by the same permit, and the Comptroller says there is no fee for it, though a security bond may be required; selling personal items occasionally can fall under the occasional sales exemption instead.

Texas calls it a sales and use tax permit, issued by the Texas Comptroller of Public Accounts.

General information, not tax or legal advice. Check with a tax professional about your own situation.

Checked against the official pages listed below on .

Texas in short

Sell only on marketplaces that collect the tax:
Yes: the state says to register
Also sell direct (own site, Facebook, flea market):
Yes: the state says to register; no fee
Resale certificate:
Texas Sales and Use Tax Resale Certificate (01-339)
Garage and occasional sales:
Exempt: one or two taxable items in any 12-month period, or no more than $3,000 a calendar year of items originally bought for personal or family use
Where to register:
Texas Online Tax Registration Application (or Form AP-201)

If you sell only on eBay, Poshmark and other marketplaces

A Texas seller that sells through a marketplace is still responsible for having a Texas tax permit and filing its sales and use tax returns on time, even if its only sales are through a marketplace provider. A remote seller that sells only through a marketplace provider that has certified it will collect is not required to hold a Texas permit, but must keep records of its marketplace sales for at least four years.

The rule: Texas Comptroller, Marketplace Providers and Marketplace Sellers; Remote Sellers and Marketplace FAQ.

"If you are a Texas seller and sell through a marketplace, you are still responsible for having a Texas tax permit and filing your sales and use tax returns timely."
Texas Comptroller of Public Accounts, Marketplace Providers and Marketplace Sellers

Texas imposes a 6.25% state sales and use tax on retail sales, leases and rentals of most goods and some services, and local jurisdictions can add up to 2% for a combined rate of up to 8.25%. Marketplace providers engaged in business in Texas collect and remit state and local tax on all sales made through the marketplace and certify that to their sellers.

Sources: Marketplace Providers and Marketplace Sellers; Remote Sellers and Marketplace Frequently Asked Questions; Sales and Use Tax.

If you also sell direct: your own site, Facebook, flea markets, consignment

You must obtain a Texas sales and use tax permit if you are engaged in business in Texas and sell taxable items, with a permit for each active place of business; people selling at fairs, festivals, markets and shows apply before selling unless the occasional sales exemption applies, and operating without a permit may bring a penalty. A remote seller needs a permit and collects use tax unless its total Texas revenue was under $500,000 in the previous 12 calendar months.

Fee:
No fee to apply, but the Comptroller may require you to post a security bond.
Renewal:
The permit is valid only while you are actively engaged in business as a seller; the Comptroller may cancel it if you are no longer engaged in business.
Register:
Texas Online Tax Registration Application (or Form AP-201)
"There is no fee for the permit, but you may be required to post a security bond."
Texas Comptroller of Public Accounts, Texas Sales and Use Tax Frequently Asked Questions: Permits

Sources: Texas Sales and Use Tax Frequently Asked Questions: Permits; Fairs, Festivals, Markets and Shows (Publication 96-211); Garage Sales and Occasional Sales (Publication 94-437); Remote Sellers and Marketplace Frequently Asked Questions; Texas Online Tax Registration Application.

Resale certificate: buying inventory without paying sales tax

The form:
Texas Sales and Use Tax Resale Certificate (01-339)
Do you need your own permit to give one?
Yes: the state ties the certificate to the buyer's own permit or account number

A permit holder buys items to resell tax-free by giving the seller a completed Form 01-339 at the time of purchase; the form asks for the purchaser's 11-digit Texas permit number (or an out-of-state retailer's registration number), and a buyer who purchases only for resale can give a blanket certificate. A Texas permit number or a copy of the permit is not a substitute for the certificate, and if you use the merchandise yourself you owe tax on it.

Thrift stores, estate sales and yard sales

The state pages we checked don't say anything specific about using a resale certificate at a thrift store, estate sale or yard sale. A certificate is given to a seller who would otherwise charge you tax, so whether a particular store takes one is between you and that seller; ask before you buy.

Misusing a certificate

Form 01-339 states that giving a resale certificate for items you know at the time of purchase are for your own use is a criminal offense, and the Comptroller grades it by the tax evaded: under $20 is a Class C misdemeanor, $20 to under $200 a Class B misdemeanor, $200 to under $750 a Class A misdemeanor, $750 to under $20,000 a third-degree felony, and $20,000 or more a second-degree felony.

"While resale certificates require the purchaser's Texas taxpayer number, the customer's sales tax permit number or a copy of the customer's permit is not a substitute for a resale certificate"
Texas Comptroller of Public Accounts, Texas Sales and Use Tax Frequently Asked Questions: Resale Certificates

Sources: Texas Sales and Use Tax Frequently Asked Questions: Resale Certificates; Form 01-339, Texas Sales and Use Tax Resale Certificate; Fairs, Festivals, Markets and Shows (Publication 96-211); Remote Sellers and Marketplace Frequently Asked Questions.

Garage sales, yard sales and other occasional sales

Exempt: one or two taxable items in any 12-month period, or no more than $3,000 a calendar year of items originally bought for personal or family use. An individual who doesn't have and isn't required to have a permit qualifies for the occasional sales exemption, including for personal items sold through the internet or an ad, by selling no more than two taxable items in any 12-month period or no more than $3,000 a calendar year of personal-use items. It doesn't apply to anyone engaged in business, anyone who buys, barters or trades items to resell, group sales, or events where you pay a fee or commission to participate.

The rule: Tex. Tax Code § 151.304; 34 Tex. Admin. Code § 3.316.

"You can sell as many items as you want to as long as your total sales are $3,000 or less during a calendar year."
Texas Comptroller of Public Accounts, Garage Sales and Occasional Sales (Publication 94-437), Occasional Sales by Individuals

Sources: Garage Sales and Occasional Sales (Publication 94-437).

Worked examples

The third sale in 12 months

The Comptroller's example: you sell a $400 piano and a $200 bicycle at a garage sale, then a $100 lawn mower within the same 12-month period. If the items don't fit the $3,000 personal-use test, the lawn mower is the third sale, so you need a permit and collect tax on it.

The $3,000 personal-items test

Also the Comptroller's example: $1,000 at a May garage sale, a $200 bicycle in August and a $500 TV in December is $1,700 for the calendar year, all personal-use items, so the exemption still applies. After passing $3,000 with more than two sales, every later taxable sale needs a permit and tax.

The Comptroller's return example: marketplace plus website

The Comptroller's own example: in a reporting period you sell $30,000 through a marketplace whose provider has certified it collects, and make $20,000 of taxable sales through your website. You report $50,000 in item one (Total Texas Sales) and $20,000 in item two (Taxable Sales); the $30,000 of marketplace sales stays out of item two.

Tax on a $40 flea market sale

At the 6.25% state rate, a permitted seller collects $2.50 of state tax on a $40 item sold at a Texas flea market, plus up to 2% local tax (up to $0.80 more) depending on location, for a combined maximum of $3.30.

Edge cases and details

  • Paying a fee or commission to sell at a flea market, arts and crafts show or similar community event run by someone else takes you out of the occasional sales exemption, even for personal items.
  • If a marketplace provider does not certify that it collects Texas tax for you, the Comptroller says you should collect tax until you receive a certification.
  • If a supplier won't honor your resale certificate and charges tax on items for resale, you can take a credit on your next return or ask the Comptroller for a refund.
  • A late return carries a $50 late filing penalty on top of any other penalties, the Comptroller says.
  • A marketplace seller that is a taxable entity, such as a corporation or LLC, may owe Texas franchise tax if it has physical presence or economic nexus in Texas.
  • If you take an item out of resale inventory and use it yourself, the Comptroller says you owe tax on your purchase price or on its fair market rental value for the time you use it, reported in the taxable purchases line of your return.
  • Buying a mix of items, tell the vendor which ones are for resale; the Comptroller says not to use a resale certificate if there is any question whether you will resell the property, and it covers resale in the United States or Mexico but not other countries.
  • Returns are due by the 20th day of the month after the reporting period, and the Comptroller allows a timely filing discount of one-half percent of the tax collected when the return is filed and the tax paid on time.
  • The Comptroller's marketplace FAQ names Amazon, eBay, Walmart Marketplace and Etsy as examples of marketplace providers.

What to do

  1. Living in Texas and selling on marketplaces: apply for the free permit through the Texas Online Tax Registration Application; the Comptroller says Texas sellers file their returns on time even when the marketplace collected all the tax.
  2. Buying inventory: give suppliers a completed Form 01-339 with your 11-digit permit number; use a blanket certificate if everything you buy from that supplier is for resale.
  3. Clearing out your own belongings: track your sales against the two-items and $3,000 tests, and get a permit before the sale that crosses them.
  4. Selling at a market where you pay a booth fee or commission: get a permit before the event.

Common questions

Do I need a Texas sales tax permit if eBay collects the tax?

Yes if you are a Texas seller; the Comptroller says Texas sellers must have a permit and file returns even if their only sales are through a marketplace provider.

How much does a Texas sales tax permit cost?

There is no fee, but the Comptroller may require a security bond.

Can I sell my own stuff online in Texas without a permit?

Possibly, under the occasional sales exemption: no more than two taxable items in any 12 months, or no more than $3,000 a calendar year of items bought for personal or family use, as long as you don't buy items to resell.

How do I report marketplace sales on a Texas sales tax return?

The Comptroller says marketplace sales go in item one (Total Texas Sales) but are left out of item two (Taxable Sales) when the marketplace provider has certified it collects; sales you make outside a marketplace are reported as taxable.

What is the penalty for misusing a Texas resale certificate?

The Comptroller grades it by the tax evaded, from a Class C misdemeanor for under $20 up to a second-degree felony for $20,000 or more.

Related

General information, not tax or legal advice

This page summarizes Texas's own published pages, rules and statutes as read on . It doesn't say whether you must register, what you should file or whether you owe tax: that turns on your own sales, where you sell and what you buy. Rules change. Check with a tax professional, or ask the Texas Comptroller of Public Accounts directly.

Sources

Official pages this page is built from, with the day each was read.

Free 1-page Reseller Cheat Sheet: fees on 8 platforms, Media Mail and stamp prices

What each platform takes from a $10, $25 and $50 sale, Media Mail 1-10 lb, Ground Advantage to Zones 1, 5 and 8, and the Forever stamp, on one printable page. The link appears as soon as you sign up.