Monday, January 9, 2012

Why are we charged tax if we are buying product wholesale?

"As a rule of party plan companies, sales tax is precollected on the retail price. It is based on the tax rate of the shipping zip code. When you sell the item you charge tax and keep it as a reimbursement to yourself because the tax was precollected and submitted to the state by Paparazzi corporate when the product was originally purchased." - Corporate Facebook Page

I thought this was a very brief, but complete description of the taxes associated with checkout.  Even though the jewelry only costs us $2.75 at check-out, each item is taxed on $5 because that is what we are supposed to sell it for!  SO you do not need to worry about sending in sales tax money to the govt because Paparazzi takes care of that, but you do need to charge it (thus why most consultants do $5.50) or the taxes will be coming out of your commission.


  1. So do I need to even mention my Paparazzi business to my accountant?

    1. Absolutely!!!! You get to keep a lot more money/income in your taxes because home-based businesses have great tax deductions! You still have to report your income tax to the govt. It's the sales tax which is taken care of through Paparazzi.

  2. in Tennessee the sales tax is horrific