A heads-up to McDonald’s franchisees: DoorDash plans to remit state sales tax on the delivery orders in 19 new states starting Sept. 1, 2020.
The 19 affected states are: Arkansas, Connecticut, Georgia, Hawaii, Idaho, Indiana, Iowa, Kentucky, Maine, Nebraska, Nevada, New Mexico, North Carolina, North Dakota, Rhode Island, South Carolina, South Dakota, West Virginia and Wyoming. DoorDash already remits state sales tax in Pennsylvania and Washington state.
Uber Eats currently remits state sales tax in 32 states (see the list here) and Grubhub has started in a few states, as well (but doesn’t list which states on its website).
The best way to know if a third-party delivery service is remitting state sales tax is to check the monthly statement for a “marketplace facilitator tax.” This is the easiest way to know if they are remitting sales tax – especially if you start working with another third-party delivery service or if your state gets added to a particular service’s collection list.
If the delivery service has remitted state sales tax as a marketplace facilitator, you do not have to remit the state sales tax for those sales. It’s important to check your delivery service statements each month so you’re not overpaying sales tax.
Please note that only state sales tax will be remitted by the delivery services. They will not remit any local or county tax.
If you have mistakenly remitted sales tax on delivery sales that were also remitted by the delivery service, you can amend your tax returns to get the duplicative tax back. Please contact us with any questions you have.