Tax ID

[piripiri]

I have had a small business for a while now but I have recently started creating customized apparel and gifts. At first, I was buying blank sweatshirts and t-shirts at Walmart or something similar. I always made sure to buy a good quality but affordable for myself and my customer. I also bought some blanks for the customized gifts i.e. makeup bags, chenille patches and so on. I’m now getting busier and the once in a while t-shirt or sweatshirt from Walmart wasn’t cost efficient so I started to look at wholesale websites like jiffyshirts or S&S activewear etc. The costs of the apparel were better than Walmart but I still felt like they were a bit high. I got my EIN but I wasn’t sure if I should get my tax I.D. What’s your opinion on a Tax I.D.? Are the prices on these wholesale website better with a tax I.D. or is there much of a difference? I love using brands like Comfort Colors, J America, Bella Canvas and Next Level but still find the prices are a bit much. Thanks in advance for any help.

 

[7even7eas]

@piripiri Your EIN (Employer Identification Number) is your federal tax ID for a business, similar to how your SSN is your tax ID for an individual. So I'm not sure what you're asking about that exactly.

When purchasing wholesale you don't have to pay sales taxes if you are reselling the items later, but this means that you have to register to pay sales tax and that you must collect and pay the sales tax on your sales, and file the necessary forms each month. This registration is done on the state level. You can then provide a wholesaler with your EIN (aka tax ID) and your reseller's certificate and they will not charge you sales tax when purchasing from them.

I am not an expert on clothing prices but in my limited experience discounts on t-shirts for printing are entirely volume based. And they don't get really good until you get into pretty large volumes (thousands of shirts at once).

 

[piripiri]

@7even7eas I thought the same thing about my EIN but I tried using my documentation for my EIN on several wholesale websites and they will not allow me to use it. They ask for my tax I.D. Which I do not have. Therefore, I am unable to get the wholesale price.

 

[7even7eas]

@piripiri Then they are probably asking for your Sales Tax ID which would be issued with your resellers certificate. In my state it ends up being your EIN with a couple extra characters on either end, but you still need to get the certificate if you want to buy without sales tax. You'll need to figure out the process for whatever state you are in.

 

[piripiri]

@7even7eas Thank you so much for your help!