[NAFEX] wholesale nurseries

Claude Sweet hortventures at cox.net
Mon Mar 1 14:02:08 EST 2004

Every state has different rules and regulations, but they generally have 
separate divisions of government that handle nursery licenses and the 
issuing of sales tax permit numbers.

Many states will have a no fee nursery license for home gardeners who 
sell less than a specific amount of merchandise. This usually is 
restricted to items they propagate and grow themselves and not for the 
purpose of reselling plant material.  Generally once a person becomes a 
reseller, they fall into a fee based nursery license that can be based 
in the number locations, size of growing or selling area(s).

It has been my experience that venders require the buyer to either pay 
the sales tax at the time of purchase or have on file a sales tax 
license number. Payments of the sales tax is the responsibility of the 
holder of the sales tax license and may require quarterly or annual 
payments which are business deduction when the federal and state 
business tax forms are filed.  I would NEVER do this as a schedule C 
sole proprietor business.  Obtain a dba, a bank account, and form a 
corporation or partnership reduces the chance your personal tax returns 
will be audited.

I offer no legal advice about using an existing business venture. For 
example, if you were a garden writer and have formed a business for the 
purpose of your writing efforts, you might also accomplish the 
landscaping purchases as it would seem to be an excellent idea for a 
"how to" article with photos illustrating the project - check with a tax 
or legal person to confirm.

No amount of money you might save is worth the time, effort, and expense 
of an audit.

Claude Sweet
San Diego

tanis cuff wrote:

> Some years ago I tried to understand the WI regs on this.   Never did 
> feel as tho I had a good grasp of it, and regs change w/ time.   BUT, 
> I doubt there is any rule anywhere that says you must have a nursery 
> license just to buy wholesale, but rather for turning over the product 
> in a business or possibly hobbie venture.  (Here in WI the logic was 
> to license & keep track of the people/places who were turning over the 
> larger volumes, for keeping track of disease & insect spread.)
> The wholesalers I bought from were concerned only that a buyer order 
> enough volumes of plants to make the exchanges worthwhile.   That's 
> like the "wholesaler discount" advertised by those nurseries which try 
> to do both wholesale and retail.
> I never did completely understand the tax issues, sorry.   Wholesalers 
> and retailers in WI were (are?) issued a "tax number", for which 
> current info can probably be got from the WI Dept of Revenue-- that 
> is, your state's Dept.
> tc
> ----Original Message Follows----
> From: markl >
> To: North American Fruit Explorers <nafex at lists.ibiblio.org>
> Subject: [NAFEX] wholesale nurseries
> Date: Mon, 01 Mar 2004 11:29:00 -0500 (EST)
> I have a bunch of landscaping to do of my own yard ($2000 or more in 
> plants to purchase).  I have been advised that I can get a nuresery 
> business license from the state for $45 and buy my plants from a 
> wholesale nursery at a lower price that at a retail place.  I may 
> resell a small quantity of plants to friends if I have the energy to 
> organize this, but that is not my main purpose in getting the 
> license.  As long as my sales a below a certain level, I won't have 
> taxes to pay to the state.  What is the catch here?  It sounds like 
> I'm getting something for the nothing (buying plants at wholesale 
> prices).  Could someone please explain the wholesale nursery business 
> to me?  Can I by a few plants here, a few plants there, or do 
> wholesale places only deal in big orders?  Is the wholesale/retail 
> distinction all about tracking who pays what taxes?
> -Mark Lee
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