Is it the end of the line for California ham swap meets?

Posted: September 9, 2015 in Uncategorized

TaxCollector

I was at a local amateur radio club meeting a few nights ago. I was talking to several of the club members who were upset about the recent visit by California State Board of Equalization Agents at the local monthly ham radio flea market at the local college.

This particular flea market has been a regular summertime activity for nearly 40 years. The club members felt that the tax collection agents visits spelled doom for future amateur radio flea markets. They said that seller/vendor attendance and visitors was down from the previous months.

This particular flea market is mostly junk electronics and computers, folks cleaning out their garage with a small mix of sellers of retail stuff.

Following this discussion at the club meeting, I decided to research the current California tax laws pertaining to flea markets and form my own conclusions.

The scary stuff:

The California State Board of Equalization defines a swap meet or flea market as two or more people or businesses offering merchandise for sale or exchange, and prospective sellers are charged a fee for space rental or prospective buyers are charged an admission fee.

The California State Board of Equalization requires a BOE-410-D form to document seller information. The BOE advises that you may not rent space to sellers until you have verification that they hold a valid seller’s permit. However, some sellers are not required to have a sellers permit if:

  1. If their retail product sales are not subject to tax.
  2. If their sales are exempt as occasional sales (twice per year)
  3. If they sell on behalf of a section 6015 retailer
  4. They are a qualified itinerant vendor.

BOE site visits

Our representatives periodically visit selling events to verify that operators have complied with the legal requirements for operating a swap meet, flea market, or special event. Our representatives may also check to see that sellers making taxable sales are displaying their seller’s permits as required by law.

At each visit, BOE employees will:

  • Identify themselves and show identification;
  • Verify the existence of a seller’s permit, fee permits and other business licenses/permits that may be required, including a city or county business license, if appropriate;
  • Review your required documentation to verify that it is updated with the correct information;
  • Provide guidance on reporting your information correctly;
  • Answer questions you may have.

What happens if I don’t have the right documentation?

  • If you do not keep permit and/or license information on all sellers who conduct activities on premises you own or control, you may be violating state law (Revenue and Taxation Code section 6073).Note: This publication summarizes the law and applicable regulations in effect when the publication was written, as noted above. However, changes in the law or in regulations may have occurred since that time. If there is a conflict between the text in this publication and the law, the application of tax will be based on the law and not on this publication
  • You may be required to pay a penalty of up to $1,000 for each seller for which you fail to keep records if that person is required to hold a seller’s permit and does not hold a valid permit for sales made on your premises.

The bottom line: In California, if you are an occasional seller of used (non retail) items, you are not required to have a permit to sell at a flea market or swap meet. So let the monthly amateur radio swap meet carry on!

What do you think?

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Comments
  1. Gary Hinson says:

    Is it just me, or does “Board of Equalization agent:” sound like doublespeak, 1984 George Orwell style?

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