are freight charges taxable in arizona
1 Show charges for freight separate from everything else-Do not mark it up and do not combine handling charges with freight charges. 2  Most states charge tax on handling charges, so combining them with freight charges (e.g. S&H) will make both taxable. Shipping is Not Taxable if Separately Stated These states say shipping charges are not taxable if you show the charge separately from the selling price of the item. They are taxable if you include the charge as part of the price of the item. 1  Alabama. 2  Arizona. Answer: It depends. Like almost everything else in sales tax, the laws around taxability of shipping charges you pass along to your customers is not universal. Some states say it’s taxable. Others say it’s not. They have nexus in Arizona, and the merchandise ships from California via a 3rd party shipper. The invoice states a merchandise cost and a freight/handling cost in two separate boxes. But they are charging sales tax on the sum of the merchandise plus the freight/handling cost. From the Arizona Department of Revenue website: When included in the retail sales price, a shipping charge from the manufacturer or wholesaler to the retailer is considered a cost of doing business and is included in the taxable proceeds from the sale. Summary of Sales Tax on Shipping in Arizona. Many states are confusing on shipping or even simply don’t take into account, making you play guessing games. Arizona, though, is nice and straightforward. If the shipping costs are separately stated on the invoice, you shouldn’t have to collect. Tax on freight generally follows the transaction the freight relates to. If the goods you sell are exempt and you charge your customer for freight or delivery charges or handling charges, then these charges are exempt. Basically, if the cost of shipping & handling is included in the retail sales price, it’s considered taxable. If it’s stated separately and shipped directly to the purchaser, then you may exclude it from sales tax. 1 Freight is by common carrier-you should not use your own truck. 2  To do so indicates shipping is a necessary part of the sales transaction and this makes the freight taxable in many states; 3  Show charges for freight separate from everything else-Do not mark it up and do not combine handling charges with freight charges. Shipping is Taxable The following states say if you charge for shipping as part of an order then it’s taxable. It doesn’t matter if the shipping charge is part of the price of the item or if it’s listed separately from the price of the item. 1  Arkansas. 2  Colorado.
No