Gunbroker Caution!

[GerryER]

I recently purchased a firearm on Gunbroker and paid the dealer's invoice which included sales tax. I then received an invoice from gunbroker, for sales tax which I inadvertently paid also. I tried contacting Gunbroker twice through their "contact us" and could not get any response from them. I finally resorted to getting my bankcard holder involved who resolved the issue with Gunbroker and did a charge-back and credited my account for the taxes involved. All is good, right? No. I then get a message from Gunbroker that they suspended my account until I reverse the charge-back. Not going to happen.
Just a word of caution; check your invoices to see if taxes have been charged for the purchase you make, and make sure Gunbroker doesn't hit you again for the same amount. I suppose that the way it should work is that if the seller charges you sales tax on your purchase, you should ask him to remove it, because Gunbroker is going to charge you again.

 

[jwxspoon]

If you are purchasing from out of state, you shouldn’t be charged sales tax from the seller’s state

 

[bearcreek]

If you are purchasing from out of state, you shouldn’t be charged sales tax from the seller’s state

That depends on the states in question. https://www.thebalance.com/which-sales-tax-rate-do-i-charge-my-customers-3193251

 

[sequins]

Some states charge you theirs as well as yours, I hate it but at least it promotes local buys.

 

[Insignificant bill]

How is that even legal

 

[Ohen Cepel]

Gunbroker is a mess now, all good till there is an issue like the OP has and then you're just doinked (putting that mildly).

Had a shady seller send me used parts as new, clearly he was wrong but GB doesn't care and you can't reach a person in this lifetime. When they got sold, it went to a "marketplace" seller who does not care about doing right nor the firearms community. They could just as easily be selling wool or beanie babies so long as they get their %.

 

[dogtown tom]

If you are purchasing from out of state, you shouldn’t be charged sales tax from the seller’s state

The US Supreme Court disagrees and it's been common for the last 3+ years and discussed on THR many times.
South Dakota vs Wayfair:https://en.wikipedia.org/wiki/South_Dakota_v._Wayfair,_Inc.

 

[dogtown tom]

Some states charge you theirs as well as yours, I hate it but at least it promotes local buys.

Name them.

 

[sequins]

Name them.

Mr gun dealer of grand rapids Michigan charged low 4% sales tax on a gun broker sale prior to gunbroker remitting the tax automatically. My local dealer in WA then duly charged me the mid 9% tax here. This is a reputable gunbroker dealer and when I complained it was explained thats how it is. Maybe thats not how it is according to internet statute but I don't buy from Michigan anymore.

 

[GerryER]

In my case, the Oklahoma dealer charged me OK tax and then Gunbroker charged me OK tax again (stated on the invoice). I'm in VA! In any case if you are charged tax on an invoice and then charged tax on the invoice total again, you are paying a portion of a tax-on-tax, which is what GB did. I don't believe that is legal, but it doesn't matter, as I won't be dealing on GB anymore. I'm tired of getting shystered by GB, EB and the like.

 

[JDGray]

Mr gun dealer of grand rapids Michigan charged low 4% sales tax on a gun broker sale prior to gunbroker remitting the tax automatically. My local dealer in WA then duly charged me the mid 9% tax here. This is a reputable gunbroker dealer and when I complained it was explained thats how it is. Maybe thats not how it is according to internet statute but I don't buy from Michigan anymore.

That’s odd, our state sales tax is 6%

 

[sequins]

That’s odd, our state sales tax is 6%

I did that purchase in 2020, I think it was like 4.1% or 4.3% something like that, perhaps the rate has increased or perhaps I'm misremembering the figure; I definitely paid twice though and it was outrageous. I actually might have the invoice printed in the guns box in my basement let me see if I can find the picture. Gunbroker doesn't save them past 90 days.

 

[JDGray]

I did that purchase in 2020, I think it was like 4.1% or 4.3% something like that, perhaps the rate has increased or perhaps I'm misremembering the figure; I definitely paid twice though and it was outrageous. I actually might have the invoice printed in the guns box in my basement let me see if I can find the picture. Gunbroker doesn't save them past 90 days.

No biggie
I also thought the receiving FFL charged the tax, but not sure on just a transfer. MI tax went from 4 to 6% back in 94

 

[jag22]

Just wondering if this might be the case. A dealer is an official business that would have a business license (nothing to do with what they sell) in their home state and have to collect and remit sales tax on each transaction whether it is in-store or online. If I as an individual sell a gun on GB I have no way to remit the sales tax that I collected. So my question is, does GB know if I am an official business or just an individual. If a "business " then GB knows I will be reporting the sale to the state and be remitting the tax they collected. If GB knows I am an individual then they will be collecting the tax and remit it to the proper state. I've never sold anything on GB so I have no idea what they do.

 

[dogtown tom]

Mr gun dealer of grand rapids Michigan charged low 4% sales tax on a gun broker sale prior to gunbroker remitting the tax automatically. My local dealer in WA then duly charged me the mid 9% tax here. This is a reputable gunbroker dealer and when I complained it was explained thats how it is. Maybe thats not how it is according to internet statute but I don't buy from Michigan anymore.

That's not what you wrote above: "Some states charge you theirs as well as yours..."
That implies that the some states require collection of sales taxes for two states, the sellers state and the buyers state. That isn't accurate in the least.
Anyone buying off the internet is best served by knowing the sales tax collection policy of their state and the seller BEFORE completing the purchase.

If you are unclear about how GunBroker determines sales tax and how they collect and remit ON BEHALF of the seller, read this: https://support.gunbroker.com/hc/en...-Marketplace-Facilitator-Sales-Tax-Collection

So, what does that mean? It likely means your GunBroker invoice shows X% sales tax charged to your seller, who in turn will pass that charge on to you.

 

[sequins]

So if I pay 4% to Michigan and 9% to WA how is that different? My understanding after talking to both dealers is they both felt they were obliged to collect under the law, and both remitted those payments to their respective states. I don't fully understand the mechanisms in play besides my invoice experience which showed a line item for the sales tax from Michigan, which didn't help me with the WA tax man.

 

[dogtown tom]

So if I pay 4% to Michigan and 9% to WA how is that different?

You should not be charged sales tax for the sellers state. North Dakota vs Wayfair made that clear.
As noted in the link above, GunBroker (as a Marketplace Facilitator) calculates sales tax based on where the buyer lives, not the seller. GunBroker will calculate the sales tax, charge the seller for that sales tax and remit to the buyers state. The seller passes that sales tax charge on to you. If he's charging you HIS states sales tax..........he's scamming you.

My understanding after talking to both dealers is they both felt they were obliged to collect under the law, and both remitted those payments to their respective states.

Every state that has a sales tax, has a website that clearly outlines when sales tax must be collected. Further, GunBroker makes it clear as to who pays.

I don't fully understand the mechanisms in play besides my invoice experience which showed a line item for the sales tax from Michigan, which didn't help me with the WA tax man.

Washington DOES require a Washington gun dealer to collect USE TAX on an interstate transfer from another gun dealer. BUT......Washington sales tax was ALREADY COLLECTED and remitted by GunBroker. Therefore the Washington dealer does not collect use tax.

 

[Poper]

I finally resorted to getting my bankcard holder involved who resolved the issue with Gunbroker and did a charge-back and credited my account for the taxes involved. All is good, right? No. I then get a message from Gunbroker that they suspended my account until I reverse the charge-back. Not going to happen.

This is why I haven't had a GB account or dealt with GB since 2017. If you read the GB TOS will we see that you are bound by what GB decides. PERIOD. Nothing else matters. GB billed me twice for one month's fees 3 months apart. There is no such thing as GB customer service. After 6 months of back and forth with GB and the CC company I just paid it and told GB to stuff it. I haven't bought or sold anything on GB since and could care less if GB vanished from the face of the Earth. These days it's a local purchase if possible or any place other than GB on the interwebs.

 

[SundownRider]

This is why I use GunsInternational. The fees and taxes on GB became a convoluted mess.
GI is $18 for a basic listing that lasts for months, and nothing else.
Cabelas lists on there as does Guns.com

just saying.

 

[reddog81]

If he's charging you HIS states sales tax..........he's scamming you.
.

Or he could just be completely clueless. If the seller is collecting the tax and handing it over to the state, he’s not gaining anything.

FWIW any taxes correctly paid to state #1 should be credited against taxes owed to state #2. In this case that wouldn’t apply though because the taxes to MI wouldn’t qualify as being correctly paid, since they were never owed.

 

[SchmidtRubin]

The only thing I use GB for is to see what kind of prices guns are bringing. I think it would be better/safer to buy, sell, and trade on forums with members that have established some history on the forum. I also think certain types of crypto should be adopted to avoid transaction fees and being shut down by paypal or stripe simply because someone labeled the transaction "1873 Winchester Receiver" and they now think you're a gun dealer even though it's an antique...

 

[dogtown tom]

Or he could just be completely clueless. If the seller is collecting the tax and handing it over to the state, he’s not gaining anything.

GunBroker has made it abundantly clear to sellers what states sales tax is being charged to the seller and that GunBroker is remitting that tax to the buyers state. They've sent me at least twenty emails about that in the last year.

FWIW any taxes correctly paid to state #1 should be credited against taxes owed to state #2. In this case that wouldn’t apply though because the taxes to MI wouldn’t qualify as being correctly paid, since they were never owed.

I dont believe so. As a marketplace facilitator, GunBroker collects sales tax based on the buyers state of residence. ZERO is being remitted to the sellers state of residence because the law does not require it. The sellers state gets it all, there is no "credited against" thing at all.

Again, to be clear.......GunBroker will debit the sellers account for the state sales tax owed in the buyers state of residence. It's literally on every GB invoice. They are required to do so as a "marketplace seller". The seller will collect the winning auction amount as well as what amount of sales tax GunBroker charged him.
Example:
Seller is in Georgia, buyer is in Texas. Winning bid or purchase price on GunBroker was $1000.
As GunBroker is the marketplace facilitator, they will charge the seller TEXAS sales tax and remit that amount to the State of Texas.
GunBroker can choose to collect an exact TX sales tax rate based on the buyers location, or choose a flat 8% for internet sales tax.

Soooo........GunBroker bills the Georgia seller $80 at the conclusion of the auction or sale. This billing is separately invoiced from any GunBroker fees. The seller doesn't remit anything to the State of Texas because GunBroker is doing that for him as required by law. The GunBroker seller will invoice the buyer for the winning bid/purchase price, PLUS the amount of sales tax being deducted by GunBroker............So $1080 total plus any of those bogus "compliance fees GB now charges.

At no point would the seller charge or remit sales tax of any kind to HIS state. If asked, the buyer should refuse.

 

[GerryER]

GunBroker has made it abundantly clear to sellers what states sales tax is being charged to the seller and that GunBroker is remitting that tax to the buyers state. They've sent me at least twenty emails about that in the last year.

....... As a marketplace facilitator, GunBroker collects sales tax based on the buyers state of residence. ZERO is being remitted to the sellers state of residence because the law does not require it. The sellers state gets it all, there is no "credited against" thing at all.

At no point would the seller charge or remit sales tax of any kind to HIS state. If asked, the buyer should refuse.

If you read my original post, I'm in VA. I purchased a gun from a store in OK, which invoiced me and included OK sales tax on the invoice. Gunbroker then invoiced me for OK tax again, but based upon the seller's invoice total, so I was paying tax-on-tax, as well as two times the OK tax. Perhaps they should have been charging me VA tax, not OK tax, and perhaps I erred in paying the seller.

 

[.455_Hunter]

I am happy the vast bulk of my GB purchases occured before this complication started. It's pretty much just a price reference guide for me now.

 

[reddog81]

I dont believe so. As a marketplace facilitator, GunBroker collects sales tax based on the buyers state of residence. ZERO is being remitted to the sellers state of residence because the law does not require it. The sellers state gets it all, there is no "credited against" thing at all.

You don’t know what taxes the seller is remitting. Businesses regularly collect and remit the wrong tax.

Regarding the credit, I was talking about sales tax laws in general. If you correctly pay tax in state #1 you should get a credit for taxes owed to state #2 if the taxes to state #1 were legitimately due. If the seller bills the tax incorrectly, and state #1 tax is not owed, you would not get the credit. It’s more applicable for businesses who buy and use property across many states.