How to Register for Sales Tax | Complete Massachusetts Walkthrough

If you like this video and would like this level of detail for the sales tax process, and basically have someone hold your hand all the way through it and show you exactly what to do every step of the way, make sure you stay to the end because I'm going to be telling you all about how to do that.

0:42 Heidi

Let's walk through a Massachusetts sales and use tax registration for remote sellers.

So I'm going to start with my registration quick reference guide and just click on the link for Massachusetts. That brings me back over to the Massachusetts login screen.

Looking back at the quick reference guide, it shows us that Massachusetts is scenario B, which is that we start by registering. We fill out an application for the appropriate tax type, which was sales and use tax.

So back on the login screen, we're going to scroll down until we find register a new taxpayer and click on that. Although create my login is the first option here, this is saying that I am someone who has previously filed taxes in the state of Massachusetts, and that's not us. So we are registering a business.

We can go down and click next. We're going to register a business. Click next. And this is where we need our information. So we need to put in what type of organization, if we're nonprofit. In this case we are not. And then we can click next.

2:08 Business details, addresses, and payment channel

On the next page it will ask for our business start date, our FEIN, and the legal name of the business. For business start date, they are asking for the actual date that your business began, not just the date that it began in Massachusetts. So put the date that it was incorporated, or the date that your company was actually started.

On the following page, it's going to ask us for our address. Once you enter your address, you'll have to click verify address, and it will come back with the option of using the standard address or the address that you entered. So I'll show you what that looks like.

Okay, so I've entered my address. In this case it's the address for the Space Needle in Washington, but now I'm going to click verify address. Notice I have four zeros at the end of the zip code. It's going to give me suggestions on what I should use there. So the verified address has this 4607 at the end, which is what the post office uses as the last four. So as long as the rest of my address is the same, 400 Broad Street in Seattle, Washington 98109, I can go ahead and select this address. And now it shows address has been verified.

Then you can select if you want your documents going to a different mailing address. You can select no, that your legal address and your mailing address are different, or if you want them to be the same, then you can select yes.

3:38

If you're considering making electronic payments in the future, so paying your filings online, it would be good to set this up. You don't have to do it now, you can do it later, but while you're just setting everything up, it's kind of nice just to be able to have this done.

So you would put in your account type, whether it's checking or savings, the account number, and then confirm the account number, your routing number. And this will pull up, once you put in the routing number, it will pull up your bank name. And then what you want that payment channel to be called. So it can just be the bank name and the last four of your account, or whatever you want it to be.

On this page, you need to select which account types you need. In most cases it will just be sales and use tax, but it would be good to look through these and make sure that there's nothing else that you need, that you're not a cigar retailer or jet fuel retailer. So it'd be a good idea just to look over and make sure there's nothing that applies to your specific company.

4:43 Choosing your NAICS code

Now it's time to pick your NAICS code. If you are a remote retailer making most of your sales online, the best code to use is 454110, and that takes you to electronic shopping and mail order houses. This works when they're using the NAICS codes from 2017. They have updated them in 2022 and some of the states use them. If you are registering with a site that's using 2022 NAICS codes, you would use 455219. But for this one, since they're using 2017.

And the way I figure it out is I always start with this one, because most states are still on the 2017 NAICS codes. So I always start by putting in 454110, or electronic shopping, and if it doesn't pull that up, then I would try 455219. So I'll select that one. And then next.

5:48 Owner information and location details

On this page you'll be entering the owner or officer information. So their title, manager slash member, the start date, which normally will be the date that the company was opened, unless they started later on. First name, last name, and then their address. And then just like on the previous page, you do need to verify the address. So just like we did, click on it and then make sure that the address is correct.

In Massachusetts, there's not a difference to how someone inside Massachusetts would register as opposed to a remote retailer. So this is more geared for someone that is located inside Massachusetts. It's asking for a location DBA. It doesn't have an asterisk there, so you don't have to fill it in, or you can just put your company's name again.

6:39

On this line you need to enter in the first date that you are required to register in Massachusetts. So it's the date that you started collecting sales tax there, or the date that you hit nexus. So I usually enter in on this line the date that we started collecting sales tax.

And then just like on the other pages, you'll enter in the address, the same address that you entered in before, because if you're a remote retailer you do not have a Massachusetts address. So you would enter in the same address from before. Verify address, and then you can continue.

This page is very similar to the last page as far as these first questions go. So you're going to enter in the first date that you're collecting sales tax in Massachusetts, or the date that you hit nexus. And then on the DBA name line, if you want to enter in something, you can just enter in your company name again. In most cases, you're not going to be a vending machine, a motor vehicle leasing company, a material man, or a license, or a marketplace facilitator. And most companies don't operate on a seasonal basis.

7:54 Filing frequency

This next part is going to determine whether you are going to be a monthly, annual, quarterly sales tax filer. This is based off of your estimated annual sales tax.

So the way to figure this out is to take your previous year of sales and multiply it by 0.0625, which is a good average sales tax rate for Massachusetts. In most cases, if you've hit nexus in Massachusetts, that means you've hit a hundred thousand dollars in sales in the last 12 months, so 6.25% of that would be 1,250. So you'll probably be in this category, and a monthly filer.

This next question just asks if you want the option below to be the mailing address, and you've already selected that before. So you can just select yes and then go on.

9:00 Creating your MassTaxConnect profile and submitting

On this page, you're going to start creating your MassTaxConnect online profile. So you will put in your full first and last name.

On the next step you're going to create your four digit PIN, and that can be any four digits. It can be a year that's important to you, or just any four numbers. Just make sure you record them somewhere so you don't forget them. You'll put in your email address twice, and then your phone number.

And now you're going to create your username and password. So it tells you what your username must consist of. There's not a whole lot of rules there. And then it tells you what your passwords have to have. You need to have one upper case, one lower case, one number, and one special character, and it needs to be at least eight characters. Just like before on those, and on your secret question that you choose here, make sure you record your answers somewhere so that you don't forget them.

On this page, there's only one box, and it's if you are going to need access to multiple client taxpayers. This is more for if you're doing accounting work, or if you have several entities that you'll be doing the accounting for. So in our case, we're not going to select it. And we'll just select next.

Now you get to read the terms of use agreement. I'm not going to go over all of them, but it'd be good just to look over them. And then we'll select agree, and next.

For privacy reasons, I'm not going to go over the next page, just because it has all of the information for our company on it. But you're going to just look through and make sure that all of the information that you have already entered in is correct. And then you can hit submit.

10:53

After you've submitted your registration, you'll receive this page. It'll have the information that you submitted before, your username, your PIN. It won't show you your password though, that hopefully you recorded earlier. And then it says you'll receive a confirmation email shortly.

Once you get that email, and it's usually within a few minutes, you can go back to the login page that we entered in the first place, and you can put in the username and password that you created, and it will have you enter in an email address to use for a two-step verification. And then you'll be in, and you'll be able to see all of your account information.

So if you come back to this page and enter your username and password, you'll select whether you want to receive your two-step verification through an authentication app, text message, or email. And once you select it, it'll have you put in your methods. So if you choose phone, it'll have you enter in your phone number, and it will send you right then a verification code that you'll put in.

Once you enter in your authentication code, it'll bring you to your homepage. And this page shows you your filing frequency, and it shows you your account number, and that's all you need. And you can start filing.

12:19 Where to learn the rest

Kelley Birrell

If you like this video and would like somebody to show you this level of detail for the entire sales tax process, then you need to check out our sales tax courses.

These courses cover everything from an in-depth nexus analysis. What that means is you can look at all of your sales from all of your channels and pull them together and see what your exposure to sales tax is going to be in each one of the states. And then how to do the registrations by state, how to set up your channels properly so that you're collecting the right amount of sales tax. And then also how to file and remit sales tax in each one of these states.

As well as, there's a section on sales tax tools, because this is a very arduous process to do if you're having to do it manually every single month. So we will show you sales tax tools and help you to figure out which one's going to be the best one for your business.

You can find all of this in our sales tax courses at www.LedgerGurusUniversity.com. The link is in the description below, and I encourage you to go look and see which one would be the best fit for you, because that's exactly what these courses do. We will walk through from start to finish, and it goes into great, great detail. And then also you'll have access, through questions and all that, to our experts so that you can get your questions answered.

Anyway, I hope you found this interesting, and we'll see you in the next video.