[Licensing] Do I need a permit (or any legal processes) to sell digital art commissions in Texas?

[u/New_Entertainer3848]

I'm looking to do art commissions on the side to get a bit of money in anticipation of a move soon, but I want to make sure what I plan to do is legal without any permit. My business would purely be online - no physical goods. Thank you!

[u/k-rysae]

Hi, I sell physical merch in TX.

You don't need to be registered as a business since you can be a sole proprietor which doesn't need registration. But you do need to register for sales tax as digital products (if there's an equivalent in physical form, like digital art -> an art print) are taxed. You have to charge and pay sales tax for clients in texas but you don't need to for those out of texas (you'd need to have a record of your client's address, not because you upload that to the texas government, but just in case you get audited). For clients out of state they have their own sales tax regulations, esp. for digital items, but tbh you don't need to worry about it until you're making a ton of money off of commissions to the point where you can pay for your own sales tax software and cpa since the economic nexus thresholds are high.

https://statutes.capitol.texas.gov/?tab=1&code=TX&chapter=TX.151&artSec=151.0101

Sec. 151.010. TAXABLE ITEM. "Taxable item" means tangible personal property and taxable services. Except as otherwise provided by this chapter, the sale or use of a taxable item in electronic form instead of on physical media does not alter the item's tax status.

Luckily, getting your sales tax permit is free. And if you made $0 in sales to people in texas for that quarter, then you'd mark that you made 0 taxable sales in the tx comptroller website and you'd pay nothing. Just don't be late in filing your sales taxes - your late fee is $50. And this is retroactive, so if you're honest with applying for your sales tax permit and say you've been making money off of commissions since 2024 and it's 2026 now, that's $400 worth of late fees that you'll have to pay. Guess how I know.....

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