{"id":609,"date":"2019-02-07T02:23:48","date_gmt":"2019-02-07T02:23:48","guid":{"rendered":"https:\/\/www.performancesuretybonds.com\/blog\/?p=609"},"modified":"2022-01-24T16:04:27","modified_gmt":"2022-01-24T16:04:27","slug":"needs-sales-tax-bond","status":"publish","type":"post","link":"https:\/\/www.performancesuretybonds.com\/blog\/needs-sales-tax-bond\/","title":{"rendered":"Who Needs a Sales Tax Bond?"},"content":{"rendered":"

If you\u2019ve been interested in opening up your own business, you may have heard of a sales tax bond. Sales tax bonds play an important role in making sure sales taxes are properly handled. Let\u2019s take a look at some of the basics of sales tax bonds, then dive into who may be required to post such a surety bond.<\/p>\n

Sales Tax Bond Basics<\/strong><\/h2>\n

Sales tax bonds, also known as sales and use tax bonds, are a type of financial guarantee bond<\/a><\/u> that are meant to ensure that sales taxes are properly collected and remitted to state or local governments in a timely matter. This bond also serves as a guarantee that companies will file their taxes by the applicable deadline. Governing bodies use sales tax bonds to ensure that businesses within their jurisdiction are handling taxes in an appropriate manner.<\/p>\n

Just like with other types of surety bonds<\/a><\/u>, sales tax bonds involve three parties. First off, there\u2019s the obligee, which is the state or local governing body that requires the bond in this case. Next, the principal \u2014 your business \u2014 is the entity that is required to post the bond. Lastly, the surety serves as the underwriter of the bond, and steps in to resolve bond disputes if needed.<\/p>\n

Does My Business Need a Sales Tax Bond?<\/strong><\/h2>\n

Sales tax bond requirements vary, depending on local and state government regulations. They may be called by different names in different states, for example in Texas they are known as a \u201ccontinuous bond of seller\u201d while in California they\u2019re known just as a \u201cbond of seller\u201d. Sales tax bonds usually surround the sale of substances which are heavily regulated, like alcohol and cigarettes. If your business sells these types of products, you will likely be required to post a sales tax bond.<\/p>\n

Some of the most common types of sales tax bonds are as follows:<\/p>\n

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