Do I need to collect sales tax at craft fairs, and how do I do it?

You want to charge customers correctly, but tax rates and rules feel complicated. You worry about making a mistake at checkout or being questioned by customers.

Selling products in multiple states or jurisdictions often triggers “nexus” requirements, which are the legal connections that require a vendor to collect and remit sales tax. In many states, once a sales tax permit is issued, the state requires the filing of regular tax returns, even if no sales were made during that specific period (often referred to as “zero-filing”). Because sales tax regulations often change and can be complex (including Wayfair/economic nexus guidance), vendors may want to regularly review the guidelines provided by each state’s Department of Revenue to stay current.

You might verify the event location's current tax rate and set it in your point-of-sale system. Posting a small sign that says "Sales tax added at checkout" or "Tax included" can prevent surprises. Tracking tax collected daily can make filing later feel simpler and more accurate.

Should I build sales tax into prices or add it at checkout?

Both options are acceptable as long as you are consistent and transparent. Adding tax at checkout keeps your price tags clean and makes the tax explicit. Including tax in the price makes transactions faster but requires you to calculate and report the tax portion correctly.

• Use clear signage so customers know whether tax is included.
• Set your POS to match your pricing method and rate.
• Track the tax portion separately even if it is baked into the price.

Is it okay not to charge sales tax if I'm very small?

Many states still expect tax collection once you make retail sales, even if your business is small or occasional. Some areas have thresholds or exemptions, but you may want to confirm with your state or local tax agency before skipping tax at a fair.

• Check if your state has a small-seller threshold.
• Ask the event organizer about local requirements.
• If you're uncertain, it's generally safer to collect and remit to avoid compliance issues.