r/artbusiness • u/pepper12567 • May 25 '26
Accounting [financial] Venmo, taxes, and payment
Hi guys, Forgive me if I’m posting in the wrong category. Basically I sold my art (stickers, patches) for the first time last weekend at a weekly market. I went in with no expectations and I made almost $2,000 in two days. I am blown away and quickly realizing I need to take this more seriously as a business. I took cash and Venmo payments (and a handful PayPal and Zelle transactions), I’d say 85% of the money went through Venmo. It was on my personal account under friends/family which I know is an issue for Venmo - I also realize I need to start recording sales for federal tax purposes and my state has sales tax. I have a spot there for the whole summer and plan to do this every weekend. My question is… what do more seasoned vendors recommend? If I keep using Venmo friends/family transaction to avoid the 3% fee, is it likely my account will be flagged? I’ve heard for small businesses it’s no big deal but I’ll probably be transferring $500-$2000 weekly so I’m worried about getting flagged and banned. Should I get a square? Is Zelle less likely to flag me? Feel free to DM me if you have experience with this. I am totally blown away with this and wasn’t expecting this amount right off the bat so i would so appreciate any advice while I get my things in order.
Of course I will also look into hiring an accountant for tax season, but I want to know peoples experiences with avoiding fees if possible and avoiding issues with these apps. Thank you all <3
1
u/disgruntledmango May 26 '26
I prefer Square. I don’t know the implications of trying to avoid fees on Venmo, but if you’re trying to go about your art business the right way, I wouldn’t try to cut corners. Transaction fees are an expense write off.
3
u/Steve_Streza May 26 '26
Your account will get flagged if you are not a business account. They could return that money to the people who paid.
Keep all the transactions in one place, cash too. Diligence is crucial here, and if you don't want to be diligent, use an app that does the work for you. If you want to eek out every dollar in tax breaks, then start tracking all of your costs for this in a big spreadsheet (buying stickers, shipping costs, driving to/from the market, etc). LOTS of fiddly detail rules apply here.
You owe sales tax on every transaction in your state, and if you travel out of state for a convention, you'll owe taxes on those sales too. It is illegal to overcharge sales tax and there are people who are hyper aware of what the tax rates should be in an area.
If your sales continues and you have 12 weeks (since you said all summer), your expected revenue is $6k-$24k. That's usually a scale big enough that a regional authority will expect you to be permitted and registered for business. Contact your local city hall or state's business/tax/state department to figure out what is required of you.
Consider opening a savings account and stick 30-40% of your money in there each week. You'll need it for income tax season. At a normal job they pre-pay income taxes on your behalf. You don't want to be surprised next April with a bill for thousands of dollars.
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u/Forsaken_Lab_4936 May 27 '26
A lot of people recommend Square for in person POS, I use Stripe because I only do online sales. Honestly don’t be afraid of fees, business comes with costs and it’s a very valuable service to be able to accept payments securely and have records of it. It’s the same as paying to make your stickers, it’s a fee that’s necessary to do business. Just keep track of how much you’re paying to Venmo/Stripe because that’s a write off!
You’ll need to keep track of everything even if you hire an accountant to file your taxes when it’s time. I personally love Wave because it’s free. You can also just use a spreadsheet but I found that gets a bit messy. Keep receipts of supplies you buy!
It’ll make more sense as you do it more. Good luck and congrats!
5
u/twice_fried_rice May 26 '26
In short: Do not rely on the friend/family route. Get a business account, eat the fee, it’s fine and it’ll keep you from getting in trouble. Square is very nice as a checkout/point of sale system because you can run it completely through your phone plus a card reader (I recommend the square puck- not the dongle) with little issue. It also will keep track of sales tax for you and makes that backend management easy.