This is a VERY confusing subject for most photographers. I will link to a few important website you should read regarding the collection of tax:
And finally, a fancy PDF with a bunch of handy info:
Basically, you NEED to be collecting sales tax and paying it out to the government. I have several clients who are not required to pay sales tax. Some of them are exempt, because they are charities or schools. Some of them have a state sales and use certificate, and my photos will become part of a product they are going to resell (like a magazine or newspaper). Some clients are out of state and I will be shipping the final product outside of Texas’ borders.
However, other clients I DO collect sales tax on, and I send it in to Austin every January. If I shoot a wedding or family portrait, I am REQUIRED to collect tax. You should be doing it as well. If they can’t fill out a resale certificate form for you, then you have no other choice. They won’t be reselling the wedding album they bought from you. They have to pay tax.
Anyway, the above links will help you get a better idea of when to collect sales tax and what to do with it when you do. Hopefully, this will help make sense of such a confusing topic.
http://www.window.state.tx.us/taxinfo/taxpubs/tx94_176.pdf
seems to cover this as well, however… the bit on using a manufacturing exemption to NOT PAY sales tax when purchasing equipment suggests that if I retain the copyright, then I must pay sales tax on my supplies:
Photographers who sell copy-
righted pictures are not manu-
facturing taxable items for
sale and thus cannot claim the
manufacturing exemption when
buying goods and materials
used to create those photo-
graphs. A photographer who
has retained a copyright on a
photograph is responsible for
paying tax for the supplies and for the divergent
use of any equipment purchased under a manufac-
turing exemption.
Yes, it is more complex than my basic post can say. There will be many little things, like you mentioned above, that need to be considered. Thanks!