Sales Tax Information for Table Holders at
2014 and 2015 TCA National Conventions in NJ
A Message from TCA Treasurer Bob Mintz
Dear Table Holders:
Having worked in public accounting for much of my accounting career, I have researched the issue as it applies to this year's Atlantic Division TCA convention in Cherry Hill, N.J.
The rules quoted below seem pretty clear:
“The New Jersey Sales and Use Tax Act provides that most sales of tangible personal property are subject to tax. These sales include regular and occasional or seasonal sales such as those taking place at flea markets.
All businesses are required to register with the State for tax purposes at least 15 business days before starting business. To register, a Business Registration Application (Form NJ-REG) must be filed.
You will receive a New Jersey Certificate of Authority (Form CA-l) for sales tax if you have indicated on your application that you will collect sales tax or purchase materials for resale. This certificate is your authorization from the State of New Jersey to collect sales tax and accept exemption certificates.
Owners and operators of flea markets should inform all concessionaires, licensees, or lessees using space or equipment at the flea market to sell taxable tangible personal property that (1) they are required to be registered with New Jersey and (2) they must collect and remit sales tax to the State on their taxable sales. Registered sellers must display their New Jersey Certificate of Authority at their sales location at all times.
Persons regularly engaged in the business of selling taxable tangible property, taxable services, or prepared foods are considered to be sellers under the New Jersey sales tax law and are required to register and collect and remit sales tax. Registration is required even if the sales are only made on a seasonal basis (e.g., Christmas trees) or if they are only made occasionally (e.g., by an artist or craftsman who periodically sells handmade items at shows) during the year.”
As a convenience, Atlantic Division is providing a partially filled-in Form NJ-REG to help you in the registration process. It will show that this is a "Seasonal" business for the month of June 2014 starting on June 27th. After the Convention is over, all you have to do is go online, file and pay the sales taxes that you are claiming, and then you would surrender your New Jersey Certificate of Authority (Form CA-l). We will provide the details for doing this in a handout at the show.
Even if you plan on purchasing a table for the METCA show in Somerset N.J. in 2015, you will need to file a new NJ-REG (or REG-C-L) next year to register your business at that new location. That too will be provided to you by METCA at the appropriate time.
As the above text from Publication ANJ-15 clearly states, you must have registered with the State of New Jersey at least 15 days prior to the convention, so please do not delay.
Atlantic Division's hands are tied and as your National Treasurer, it is my fiduciary responsibility to make sure that TCA is in compliance with Federal, state and local laws.
After this was published yesterday in an e-Blast, there were several emails concerning the above and why we have to register, pay sales tax because we are a private organization, etc.
This is my response:
If you were to make a profit of $1000 on some sales, even though we are a private members only club, would you, being a dealer or not, have either ordinary income or capital gains income subject to Federal Income taxes on the profit? Federal income taxes are based on any type of income. Same with sales taxes.
The way that I am reading the paperwork, same as you, it says that almost all sales of tangible personal property are taxable, seasonal, etc.
The difference between TCA and the other train clubs is that we are a 501©(3) not for profit and they are hobby clubs 501©(7) People can make tax deductible contributions to TCA where they cannot to LOTS, LCCA or TTOS.
If we did something on the National level to encourage or it was interpreted by the NJ Sales Tax Bureau, as encouragement to evade paying sales tax, that may jeopardize our not for profit status. Avoiding taxes may be legal in certain circumstances (you prepaid your real estate taxes on December 31 even though they are due on January 15th of the following year for instance), but evading is definitely not. Al Capone was never convicted for anything he did, but was convicted for evading taxes.
TCA is a not for profit, we do not PAY sales taxes on certain items. As long as we have filed the proper paperwork in advance we are exempt. That does not translate into the members being exempt too.
Why are the dealers required to collect sales tax at York? I have no information on this matter and I am only guessing here, but I would imagine that there is a handshake agreement between the Pennsy Sales Tax folk and Eastern Division. They get their pound of flesh from the Dealer Halls and leave everyone else alone. Technically, that could change with a new Tax Commissioner.
Not so with the York Manchester county sales tax collectors, as the Billy Budd is a shell of its former self because of the tax people.
Another problem is that at least this meet in Cherry Hill N.J., if not the one in Somerset, WILL be open to the public and WILL be regionally advertised. More reason for the Trooper Boys to show up, we are basically waving a red flag and daring them.
In 2015, the trading hall is owned by the state of New Jersey. You don’t imagine that they will have the sales tax police patrolling the aisles?
The worst the trickle down from the US Government to the individual states level occurs, the more those states will be aggressively finding new sources of revenue.
Sales taxes are one of those methods.
Atlantic Division or METCA cannot lose their not for profit status because they are not incorporated. TCA can. We cannot, for the sake of the Organization, take that risk. I, as National Treasurer, have a duty to protect the Club and minimize any unnecessary risks.
TCA National is not going to police if an individual member decides to file for N.J. Sales Tax ID # nor what your taxable sales are. TCA has done its Due Diligence by informing table holders of the requirement to file for an ID number. The members will file their taxable sales, you could realistically have zero taxable sales, you could have a hefty amount, and you could have somewhere in between.
This is no different than having a table outside in the parking lot at the Holidome. All of those vendors are required to have Pennsylvania Sales Tax ID numbers.
The point is that if the N.J. Revenuers do show up, they cannot close down the trading pits and confiscate anything because everyone will be in compliance by having a NJ Sales Tax certificate. I have heard several reports from local toy train shows in Pennsylvania, New Jersey, New York and Connecticut, about this very thing happening.
What is filed AFTER the convention is not in National’s, but the individual member’s, hands. According to the NJ paperwork, the operator (TCA) of the event must tell the vendors about having a sales tax certificate. We have done just that, whether we agree with that decision or not.
I think that we can make everyone happy, the table holders, the revenuers, the convention hosts and the public. If you think about it, the table holders will, for the price of just filing for a tax form (total cost =ZERO DOLLARS) will have a larger audience.
I thank you for your understanding.
Bob Mintz
TCA National Treasurer
