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I have an LLC that is formed in NC. The LLC sells software online; the software is downloaded through the website. The website is run through GoDaddy, which is in Arizona, I think. The programmer who developed the software lives in another state (where we qualified the LLC to do business). I live in yet another state, and I work on the website only when I'm outside of that state and am traveling.

Our first paying customer bought from New Jersey. It's now time to file our quarterly NC sales and use tax return; until now we've always just filed them showing zero revenues and zero tax due (as we hadn't sold anything yet).

Now, do we pay NC sales and use tax on the revenue from the sale (which is under $100)? Or do we list everything as zero (since the sale was outside NC, it's not relevant for NC)? Or do we list the revenue from the sale, but just say that it's exempt from NC requirements?

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Nope. NC Sales Tax is only for sales to people inside NC. See http://www.dornc.com/taxes/sales/salesanduse.html .

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Chris is correct, you only pay sales tax in NC for sales in that state. However, you should consider consulting a CPA for your tax filings. You will need to report all revenue to NC, but because you are an LLC revenues will flow through to you and be taxed as personal income.

Again, you should probably consult with a CPA.

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Good point. Thank you! – user6492 Apr 3 '12 at 1:56

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