Cyber Monday is expected to be a record-breaker, with forecasts calling for $7.8 billion in sales, or a 17.6% increase over last year’s shopping holiday, according to Adobe Analytics.
While shoppers will spend more this Cyber Monday on the hottest electronics and toys, many will also shell out more in taxes thanks to a recent Supreme Court ruling.
“[If] you were taking advantage of online shopping as a means of potentially avoiding having to pay sales taxes on their purchases, depending on where you live you may find that is no longer the case since the Wayfair [Supreme Court] decision,” said Chuck Maniace, director of regulatory analysis at Wilmington-based Sovos, a tax compliance software provider.
In late June, the U.S. Supreme court ruled in South Dakota v. Wayfair that states can collect sales tax from online sellers even if the retailers don’t have a physical presence in that state. That decision essentially overturned a 26-year-old ruling (Quill Corp. v. North Dakota) that previously found that states could not force mail-order catalog companies to collect sales taxes unless they had a physical presence in the state.
Of course, the Quill decision was in 1992, and the retail world has since changed with the rise of e-commerce, which is why South Dakota and 36 other states had pushed for the change. States also estimated that they were losing billions annually. South Dakota, which has no state income tax, estimated that it was losing between $48 and $58 million in revenues each year.
Most states will require internet retailers to collect sales taxes
Since the Wayfair (W) decision, a substantial swath of the country has moved or is moving to apply their sales tax rules to internet sellers.
“The Supreme Court’s decision in South Dakota v. Wayfair essentially amounted to a green light for state governments to apply their sales tax rules to sellers beyond their physical borders, meaning sellers who are not necessarily located in their state but sell to their in-state customers so long as the requirements that they apply aren’t an undue burden,” said Maniace.
RELATED: 27 best Cyber Monday deals at Target
27 best Cyber Monday deals at Target
27 best Cyber Monday deals at Target
15% OFF ALMOST EVERYTHING
Availability: Nov. 26
It's rare for big-box stores to discount just about everything, but Target bucks that trend with a sweet 15 percent discount on most items across Target.com on Cyber Monday. There are some exclusions, including popular brands like Apple, Lego, and Fitbit.
BOGO 60% OFF CLOTHING AND ACCESSORIES
Availability: Nov. 25-26
This buy-one, get-one-60-percent-off deal on apparel and accessories kicks in on Nov. 25, but the site-wide discount takes an extra 15 percent off on Cyber Monday. Hundreds of thousands of items for women, men, and kids will be deeply discounted on Target.com.
ELEMENT 50" 4K SMART TV
Sale Price: $250 | Buy it Reg Price: $350 ($100 savings) Availability: Nov. 25-Dec. 1
Here’s an ultra-high-definition TV at a price you can’t afford to ignore. The crystal-clear picture is enhanced by Dolby Digital audio, and built-in wireless makes streaming all your favorite shows easy.
Sale Price: $350 | Buy it Reg. Price: $500 ($150 savings) Availability: Nov. 25-Dec. 1
This super-lightweight vacuum sucks up dirt and allergens without releasing any back into the air. It works on carpets, hard floors, and hardwood, and runs for 40 minutes on a charge — long enough to cover an entire home.
Sale Price: $150 |Buy it Reg. Price: $230 ($80 savings) Availability: Nov. 25-Dec. 1
This sleek hoverboard can ride close to 5 miles before charging. LED wheels will turn heads, while auto-balancing startup makes it easy even for beginners to hop on. Top speed is 7 mph.
Sale Price: $100 | Buy it Reg. Price: $150 ($50 savings) Availability: Nov. 25-Dec. 1
Soothe and calm babies with this cozy swing with six speeds and two vibration strengths. It also plays 10 melodies and five nature sounds.
Sale Price: 15% off | Buy it
Availability: Nov. 25-Dec. 1
Outfit the playroom with one of KidKraft’s kitchens or dollhouses, which are made to last, with detailed design and sturdy wood construction.
PHILIPS ANALOG 4 QT. AIR FRYER
Sale Price: $99 | Buy it Reg Price: $199 ($100 savings) Availability: Nov. 25-Dec. 1
Air fryers rival Instant Pots as the hot appliances this year, and $100 off makes this purchase a little easier to swallow. This model comes with a 30-minute timer and automatic shut-off.
Sale Price: $80 | Buy it Reg Price: $120 ($40 savings) Availability: Nov. 25-Dec. 1
If the coffee lover in your life needs a more convenient way to get their fix, the Keurig K200 is a good bet. Brew just one cup, or a carafe up to 30 ounces, with an easy-to-use digital display. The water reservoir holds up to 40 ounces, for more brewing and less refilling.
Sale Price: $28 | Buy it Reg Price: $40 ($12 savings) Availability: Nov. 25-Dec. 1
“Unikitty” fans will love this 515-piece Lego set with five buildable figures, a working roller coaster, a spinning chair ride, bumper cars, refreshment stands, and tons of cute accessories.
Sale Price: $35 | Buy it Reg Price: $50 ($15 savings) Availability: Nov. 25-Dec. 1
It's time to upgrade from a manual toothbrush to the basic but effective Oral-B Pro 1000, which has a pressure sensor and a timer that helps you brush each area equally.
Sale Price:$300 | Buy it Reg Price: $400 ($100 savings) Availability: Nov. 25-Dec. 1
Kick your feet up and relax while this robotic vacuum does the work. Features include virtual boundaries, easy scheduling, and focused cleaning. Control it with your voice using Amazon's Alexa or Google Assistant.
Sale Price: $90 | Buy it Reg Price: $190 ($100 savings) Availability: Nov. 25-Dec. 1
This doll set has 44 pieces of fun, including two 18-inch dolls, a 4x4 vehicle, a boogie board, a beach chair, and sand toys. The 4x4 even has Bluetooth, so the dolls can rock out to your favorite tunes. Accessories are compatible with American Girl dolls.
Sale Price:$40 | Buy it Reg Price:$80 ($40 savings) Availability: Nov. 25-Dec. 1
Fire foam darts up to 100 feet with this hefty blaster. It includes a 24-dart revolving drum for more shooting and less reloading. A shoulder strap makes for easier battles.
Sale Price: $80 | Buy it Reg Price: $130 ($50 savings) Availability: Nov. 25-Dec. 1
The Fitbit Alta is a sleek alternative to more utilitarian-looking fitness trackers. But it's not all looks: You get heart-rate monitoring; a tap-to-activate display with call, text, and calendar alerts; automatic exercise and sleep tracking; movement reminders; and impressive seven-day battery life.
Sale Price: $750 | Buy it Reg Price: $1,050 ($300 savings) Availability: Nov. 25-26
If you just have to go big with your new TV, here's a great deal. This 70-inch TV boasts a gorgeous 4K ultra-HD display, built-in Google Chromecast that works with Alexa and Google Assistant, easy wireless streaming, and a dozen local dimming zones that ensure you always see what you're supposed to see.
Sale Price: $180 | Buy it Reg Price: $280 ($100 savings) Availability: Nov. 25-Dec. 1
Work or play with this lightweight 14-inch Chromebook that boasts an integrated touchscreen. Battery life stretches up to 11.5 hours, and you get 16GB of integrated storage. Not enough? Store up to 100GB using two years of Google Drive access.
Sale Price:$40 | Buy it Reg Price: $80 ($40 savings) Availability: Nov. 25-Dec. 1
Print, scan, copy, and fax using this compact printer with a 2.2-inch display. Built-in wireless makes it easy to print whatever you need from your phone, tablet, or laptop.
Sale Price: $25 | Buy it Reg Price: $50 ($25 savings) Availability: Nov. 25-Dec. 1
Even wet messes are no match for this compact hand vacuum, which can suck up 8 ounces of liquid plus the usual dry debris and grime. The bagless dirt bowl is easy to empty and clean, and a wall mount makes the vacuum easy to store and charge. A squeegee, crevice tool, and brush tool are included.
Sale Price: $300 | Buy it Reg Price: $500 ($200 savings) Availability: Nov. 25-Dec. 1
Show pet hair you mean business with this Dyson, which features a tangle-free turbine to better trap and remove pet hair, as well as whole-machine HEPA filtration to keep that dust and dander on lockdown. The cleaner head automatically adjusts between hard floors and carpet.
Sale Price:$100 | Buy it Reg Price: $200 ($100 savings) Availability: Nov. 25-Dec. 1
Get your morning jolt with this sleek, compact little espresso machine, which preheats in just 25 seconds. It includes a milk frother for hot or cold lattes and cappuccinos, as well as a 16-capsule tasting pack.
Sale Price: $100 | Buy it Reg Price: $160 ($60 savings) Availability: Nov. 25-Dec. 1
Sous vide cooking isn’t just for professional chefs anymore. Attach the Anova to any water-filled pot, put food inside in a sealed bag, then set the cooker time and temperature, either on the Anova or with your phone. You’ll get an alert when it’s time to eat.
Sale Price: $50 | Buy it Reg Price: $70 ($20 savings) Availability: Nov. 25-Dec. 1
This all-in-one 6-quart wonder can slow cook, pressure cook, brown, sauté, and steam. It includes eight one-touch meal settings for food like yogurt, chicken, stew, soup, and rice. The nonstick cooking pot is dishwasher-safe, making cleanup a snap.
SELECT BY CALPHALON STAINLESS STEEL 8-PIECE COOKWARE SET
Sale Price: $90 | Buy it Reg Price: $150 ($60 savings) Availability: Nov. 25-Dec. 1
Get a set of sturdy basics with this durable eight-piece set of stainless steel cookware. It includes two fry pans, two saucepans, and a Dutch oven. Comfort-grip handles stay cool during cooking, and the pans are oven- and dishwasher-safe.
Sale Price: $40 | Buy it Reg Price: $80 ($40 savings) Availability: Nov. 25-Dec. 1
Men with any kind of facial hair can get a comfortable shave or a neat trim with the cordless Philips Norelco OneBlade Pro, specially designed to protect the skin even under longer, coarser hair. The replaceable blades last up to four months.
Sale Price: $70 | Buy it Reg Price: $100 ($30 savings) Availability: Nov. 25-Dec. 1
Smooth out the morning routine with this highly regarded flat iron, which has 1-inch ceramic plates that heat up quickly. It features 10 heat settings and automatic shut-off for safety. Other Chi flat irons are on sale too.
Generally, a new requirement would meet that standard if it didn’t apply retroactively and if there were an exception for the smallest of sellers, Maniace explained. Since June, a bunch of states adopted the standard that South Dakota won with at the Supreme Court.
By the end of the year, over 30 states will require internet retailers to collect sales taxes regardless of physical presence. On Oct. 1, 11 states went live with the so-called economic nexus collection requirements, and 11 more are planning to take action by January. By this time next year, Maniace expects that it will be almost every state.
“Expect to pay approximately 8% more”
What all this means is some U.S. shoppers should expect a larger e-commerce bill ahead of the holidays.
“On balance, if you live in a state that has enacted a remote seller collection rule and you buy online from sellers that historically don’t charge tax, expect to pay approximately 8% more for your purchases. So, if you plan on spending $600 online this holiday season, reserve at least an additional $48 for tax,” said Maniace
What’s more, some places will be more expensive than others. For example, shoppers in Boley, Oklahoma will be the most impacted.
“If they purchased an item online last Black Friday/Cyber Monday from an online retailer without a sales tax obligation, they can expect to pay 11.5% more on that same purchase this year,” said Maniace.
Ski resort areas can also expect to be hit especially hard as they often have some of the highest tax rates, according to Maniace. For example, those living in Bachelor’s Gulch, Colorado on Beaver Creek Mountain will be paying 9.4% more than last year for their online purchases. Colorado’s requirement will go live on Dec. 1.
Elsewhere, the rate in Raleigh, North Carolina is 7.25% so a shopper there purchasing a $20 toy from an online vendor can expect to pay $1.45 in additional tax this year. The rate in Reno, Nevada is 8.265% so a consumer there can expect to pay an additional $8.27 on a $100 electronics purchase, according to Maniace.
Those living in Pennsylvania can expect to pay 6% more, while residents of Illinois will pay 6.25% more.
Residents in Myrtle Beach, South Carolina, can expect to shell out an additional 9%, while residents of Sioux Falls, South Dakota will pay an additional 6.5%.
Residents of Alabama will pay 8% more for many online purchases this Cyber Monday. After the New Year, Louisiana residents can expect to pay 8.45% more.
If you've made an error on a tax return you already filed or simply come across new information, such as a tax deduction or credit you now realize you qualify for, file an amended tax return to make the correction. The Internal Revenue Service (IRS) knows the tax code is complex, and that people make mistakes. The process for filing an amendment is straightforward. Simply file Form 1040X, Amended Tax Return, along with the corrected or additional documents you did not originally file with your return.
Congress has passed the largest piece of tax reform legislation in more than three decades. The bill went into place on January 1, 2018, which means that it will affect the taxes of most taxpayers for the 2018 tax year.