Don't Go to Jail for Failing to Pay State Sales Tax on Internet Purchases

Question: I sell merchandise on eBay and Amazon for side income. I know users of eBay and PayPal can collect sales tax, but it seems very few sellers do. And there doesn't appear to be a way to collect sales tax when I sell on Amazon Marketplace. Should I worry about this?

ANSWER: If you live in a state where sales tax is charged on retail purchases, as the seller you are responsible for paying sales tax to your state's tax department for your online sales. However, you pay sales tax only on transactions with buyers in the state where you reside -- you don't pay tax for items shipped outside your state.

To pay the tax, you