Is shipping taxable in California?

Separately stated charges for delivery by common carrier, contract carrier or the US Postal Service are not taxable, up to your actual shipping cost. Handling charges are taxable, and in a combined 'shipping and handling' charge only the actual postage or freight part is excluded. Delivery in your own vehicle is generally taxable unless the sale happened before delivery began.

Is shipping taxable in Texas?

Yes, when the item is taxable. Texas Rule 3.303 makes transportation and delivery charges part of the sales price of a taxable item even if they're stated separately, and it covers freight, shipping, delivery and postage. If the sale is exempt, for example with a resale certificate, the delivery charge is exempt too.

Usually yes when the item is taxable. California taxes separately stated handling even though it excludes separately stated shipping. New York, South Dakota and Michigan treat handling as part of delivery charges, so it follows the shipping rule: taxable in New York and South Dakota, excluded in Michigan if separately stated and recorded.

Is shipping taxable in Florida?

Florida excludes shipping only when both conditions are met: the charge is separately stated on the invoice, and the buyer could have avoided it, for example by choosing to pick the item up. If the seller requires delivery or folds shipping into the price, the shipping is taxable. Handling counts as a transportation charge under Florida's rule.

Do I charge tax on shipping if the order has taxable and exempt items?

In states that tax shipping, you usually tax only the share of shipping that relates to the taxable items, if you allocate it fairly, for example by price or weight. New York says that if you don't allocate, the whole shipping charge is taxable, and if you lump taxable and exempt items into one price, the entire bill is taxable.

Sales tax

Is Shipping Taxable? Sales Tax on Shipping and Handling by State in 2026

Is shipping taxable in 2026? State rules for shipping and handling charges, separately stated vs bundled delivery, mixed orders and worked examples by state.

Edited by Sumeet YadavFounder & editor, MSMETOOLS · fact-checked against official sources

Updated October 2026 Verified against official sources 13 October 2026 15 min read

Is shipping taxable — MSMETOOLS guide cover

Contents (10)

1. Why the answer depends on the state
2. States where shipping on a taxable item is taxable
3. States that exclude separately stated shipping
4. Florida's two-part test
5. Shipping vs handling
6. Mixed orders: taxable and exempt items in one box
7. Worked example: the same order in six states
8. Free shipping, marketplaces and other situations
9. Common mistakes and how to fix them
10. What to do next

Every online order raises the same small question at checkout: do you charge sales tax on the shipping line too? Is shipping taxable has no single answer in the United States. Each state decides, and the answer often turns on how you word and price the charge on your invoice. This guide is for online sellers, wholesalers, furniture and appliance stores that deliver, and the bookkeepers who set up their checkout tax rules. It explains the main state approaches, the difference between shipping and handling, what "separately stated" really means, how to split shipping on mixed orders, and worked examples using state guidance checked in October 2026.

Quick answer

Shipping is taxable in some states and not in others. In Texas, New York, Pennsylvania and South Dakota, shipping on a taxable item is taxable even when listed separately. California, Virginia and Michigan generally exclude shipping that's separately stated. Florida excludes it only if it's separately stated and the buyer could have avoided it.

If the item is exempt (or sold for resale), its shipping is usually exempt too
Handling is often taxed even where shipping isn't, notably in California
Shipping folded into the item's price is taxable everywhere the item is
On mixed orders, tax only the share of shipping tied to taxable items

Why the answer depends on the state

Sales tax is charged on a "sales price" or "purchase price", and each state's law decides whether delivery charges belong in that figure. The Streamlined Sales and Use Tax Agreement, which 23 states follow as full members, sets the starting point: delivery charges are part of the sales price unless the state chooses to exclude them when they're separately stated on the invoice given to the buyer. Its library of definitions splits delivery charges into handling, crating and packing on one hand, and transportation, shipping and postage on the other, so a state can treat them differently. Member states record their choices in the Streamlined taxability matrix, which is a useful first stop for any Streamlined state.

Outside that framework, states have their own definitions, and they fall into four rough groups. This grouping is our own multistate summary of state guidance, not an official list:

Taxable even when separate. Shipping on a taxable sale is always part of the price. Texas, New York, Pennsylvania and South Dakota are examples.
Excluded when separately stated. A separate line for shipping keeps it out of tax. Virginia's statute exempts separately stated transportation charges, and Michigan has excluded separately stated delivery charges since April 26, 2023.
Excluded up to actual cost. California excludes separately stated charges for delivery by a carrier or the mail, but only up to what the shipping actually cost you, and it taxes handling.
Excluded only if optional. Florida excludes shipping that's separately stated and avoidable by the buyer, such as when the buyer could have picked the item up instead.

In almost every state, two rules hold. If the item is exempt, the shipping is exempt. And if you bundle shipping into the item's price, as with "free shipping" built into the price, the whole price is taxable wherever the item is.

Is shipping taxable? Selected states (2026, from state guidance)

State	Separately stated shipping	Handling	Key condition
Texas	Taxable	Taxable with the item	Rule 3.303: taxable even if stated separately
New York	Taxable	Taxable	Exempt only if the buyer pays a carrier on a separate bill
Pennsylvania	Taxable	Taxable	Postage and delivery billed by the vendor are taxed
South Dakota	Taxable	Taxable	Includes crating, packing and fuel surcharges
California	Not taxable up to actual cost	Taxable	Carrier or mail delivery; keep freight records
Florida	Not taxable if avoidable	Same as shipping	Buyer must be able to avoid the charge
Virginia	Not taxable	Check with Virginia Tax	Statute exempts separately stated transportation
Michigan	Not taxable	Not taxable	Separately stated and separately recorded

Texas

Separately stated shipping: Taxable
Handling: Taxable with the item
Key condition: Rule 3.303: taxable even if stated separately

New York

Separately stated shipping: Taxable
Handling: Taxable
Key condition: Exempt only if the buyer pays a carrier on a separate bill

Pennsylvania

Separately stated shipping: Taxable
Handling: Taxable
Key condition: Postage and delivery billed by the vendor are taxed

South Dakota

Separately stated shipping: Taxable
Handling: Taxable
Key condition: Includes crating, packing and fuel surcharges

California

Separately stated shipping: Not taxable up to actual cost
Handling: Taxable
Key condition: Carrier or mail delivery; keep freight records

Florida

Separately stated shipping: Not taxable if avoidable
Handling: Same as shipping
Key condition: Buyer must be able to avoid the charge

Virginia

Separately stated shipping: Not taxable
Handling: Check with Virginia Tax
Key condition: Statute exempts separately stated transportation

Michigan

Separately stated shipping: Not taxable
Handling: Not taxable
Key condition: Separately stated and separately recorded

States where shipping on a taxable item is taxable

Texas. The Comptroller's rule on transportation and delivery charges says that when a taxable item is sold, leased or rented, delivery charges are part of the sales price even if stated separately, and that applies to charges incurred before and after the sale. It covers charges labelled freight, shipping, delivery or postage. A third-party carrier that only provides transportation doesn't collect tax on its own fee. Our Texas sales tax guide has local rate examples.

New York. Tax Bulletin ST-838 says charges for shipping or delivery that a seller includes on its bill are taxable when the item is taxable, and charges labelled transportation, handling or postage are treated the same way. There's one way around it: if the customer hires a carrier and the carrier bills the customer directly on a separate invoice, that delivery bill isn't taxed. If the item is exempt, or bought with a valid resale certificate, the delivery charge is exempt too.

Pennsylvania. Its regulation says separately stated delivery charges billed by the vendor in connection with a taxable sale are taxable, and so is postage when the vendor mails a taxable item. Delivery charges on nontaxable transactions, such as sales for resale, aren't taxed, and neither are delivery charges billed by someone other than the vendor.

South Dakota. The July 2026 guide defines delivery charges as the seller's charges for preparing and delivering a product or service to a place the buyer chooses, including shipping, postage, handling, crating, packing and fuel surcharges. They're part of gross receipts and taxed at the same rate as the product. If the product isn't taxable, the delivery charge isn't either.

Hands pressing a shipping label onto a cardboard parcel on a packing bench — Whether the shipping line on an order is taxed depends on the delivery state's rules and on how the charge is shown on the invoice.· Image: Meanwell Packaging (CC BY 2.0)

States that exclude separately stated shipping

California. Regulation 1628 is the most detailed rule in the country. Separately stated charges for delivering goods directly to the buyer by common carrier, contract carrier or the US Postal Service aren't taxable, but the exclusion can't exceed what the transportation cost you. If you charge $15 and the label cost $11, the extra $4 is taxable. Separately stated handling isn't a transportation charge, so it's taxed. In a combined "shipping and handling" charge, only the part that represents actual postage or freight is excluded.

Delivery in your own truck is different. California taxes those charges unless the sale happened before delivery began, and then only a reasonable charge for the delivery is excluded. Title usually passes when goods are delivered to the buyer, unless a written agreement made before delivery says otherwise, so most own-vehicle deliveries end up taxable. The CDTFA tells sellers to use the words "shipping", "delivery", "freight" or "postage" on invoices, to keep bills of lading, freight invoices or delivery receipts that show actual cost, and to deduct nontaxable delivery charges on the return. Without cost records, tax applies to the whole delivery charge. See our California sales tax guide.

California shipping charge test (Regulation 1628)

Step 1

Separately stated?

Step 2

Carrier or mail delivery?

Step 3

Up to actual cost?

Step 4

Excluded

handling still taxed

Virginia. The Code of Virginia exempts separately stated transportation charges from sales tax. If transportation is folded into the price, it's taxable. Virginia's statute doesn't address handling by name, so confirm with Virginia Tax how to treat a separate handling fee.

Michigan. Public Acts 20 and 21 of 2023, effective April 26, 2023, exclude delivery and installation charges from the taxable price if they're separately stated on the invoice and the seller's books record them separately. Michigan's definition of delivery charges includes transportation, shipping, postage, handling, crating and packing. Charges that fail either condition stay taxable, and utility delivery charges for electricity and gas are still taxed. This summary relies on a secondary source because Michigan Treasury's site blocks automated access; check Treasury's delivery and installation charges page before relying on it.

Florida's two-part test

Florida's rule, 12A-1.045, defines transportation charges broadly as carrying, delivery, freight, handling, pickup, shipping and similar fees. Those charges are excluded from tax only when both of these are true:

The charge is separately stated on the invoice or bill of sale.
The charge can be avoided by a decision or action solely on the part of the buyer.

A furniture store that offers free in-store pickup or paid delivery meets the second condition, because the buyer chose delivery. A seller that requires delivery, such as an online store that doesn't allow pickup, doesn't meet it, so even a separately stated delivery fee is taxable. Charges built into the price are always taxable. When goods are sold FOB origin, so title passes at the seller's dock, separately stated freight the seller arranges isn't part of the taxable price. Our Florida sales tax guide covers the county surtax that applies on top.

Shipping and sales tax at a glance (2026)

Streamlined full member states

Publish delivery-charge rules in a matrix

April 26, 2023

Michigan exclusion started

Separately stated and recorded

2 tests

Florida's exclusion

Separately stated and avoidable

Actual cost

California's cap on excluded shipping

Regulation 1628

Shipping vs handling

Sellers often add a "shipping and handling" line without thinking about the two words. To a tax department they can be different things.

Shipping (also delivery, freight, postage or transportation) is the cost of moving the goods to the buyer. Handling covers preparing the order: picking, packing, crating, boxing and packing materials.

California makes the split matter most: it excludes separately stated shipping up to cost but taxes handling. If you charge a single "shipping and handling" fee in California, only the part that is actual postage or freight comes out of tax, so you need records showing what that part was. New York, South Dakota and Florida treat handling the same way they treat shipping. Michigan's definition of delivery charges includes handling, so a separately stated and recorded handling fee is excluded there too.

The practical rule: if you sell into states that treat them differently, show shipping and handling as separate lines, and keep the carrier invoices that prove your shipping cost.

Mixed orders: taxable and exempt items in one box

Many orders mix taxable and exempt goods, such as a sweater and a grocery item, or clothing that's exempt in one state and taxable in another. In states that tax shipping, you shouldn't tax shipping that relates to exempt goods, but you need a fair way to split it.

New York's bulletin gives the clearest rules. If taxable and exempt items are combined into one price, the entire bill, including shipping, is taxable. If the items are priced separately but there's a single delivery charge that isn't allocated, the whole delivery charge is taxable. If the delivery charge is fairly allocated, only the part allocated to taxable items is taxed. Allocation by price or by weight are the usual methods; pick one and use it consistently.

Example. A New York order has a $150 taxable item, a $50 exempt item and a $20 shipping charge. Allocating by price, 75% of the shipping, $15, relates to the taxable item. Tax applies to $165 rather than $170. The same logic works in Texas, Pennsylvania and South Dakota, where shipping follows the taxability of the goods.

A newly delivered wooden sideboard with its doors and drawer open on a living room floor — Furniture and appliance stores that deliver in their own trucks face stricter rules than parcel sellers in states such as California and Florida.· Image: forrest.wheatey (CC BY-SA 2.0)

Worked example: the same order in six states

A seller ships a $200 lamp with a separately stated $15 shipping charge (actual carrier cost $15) and a $5 handling charge. The buyer could have picked the lamp up at the seller's store. Here's the tax at 2026 rates in a large city in each state.

$200 lamp + $15 shipping + $5 handling

Delivered to	Rate	Taxable amount	Tax
Houston, Texas	8.25%	$220 (all)	$18.15
New York City	8.875%	$220 (all)	$19.53
Philadelphia	8%	$220 (all)	$17.60
Los Angeles	10.25%	$205 (lamp + handling)	$21.01
Miami-Dade, Florida	6% + 1%	$200 (shipping avoidable)	$14.00
Detroit, Michigan	6%	$200 (separately stated and recorded)	$12.00

Houston, Texas

Rate: 8.25%
Taxable amount: $220 (all)
Tax: $18.15

New York City

Rate: 8.875%
Taxable amount: $220 (all)
Tax: $19.53

Philadelphia

Rate: 8%
Taxable amount: $220 (all)
Tax: $17.60

Los Angeles

Rate: 10.25%
Taxable amount: $205 (lamp + handling)
Tax: $21.01

Miami-Dade, Florida

Rate: 6% + 1%
Taxable amount: $200 (shipping avoidable)
Tax: $14.00

Detroit, Michigan

Rate: 6%
Taxable amount: $200 (separately stated and recorded)
Tax: $12.00

Texas, New York and Pennsylvania tax the whole $220 because shipping and handling follow the taxable lamp.

California excludes the $15 of shipping because it's separately stated and equals the actual cost, but taxes the $5 handling: $205 × 10.25% = $21.01. If the seller had charged $19 shipping on a $15 label, $4 more would be taxable.

Florida excludes both shipping and handling because both are transportation charges under the rule, both are separately stated, and the buyer could have picked the lamp up. If the seller only offered delivery, the tax would be $220 × 7% = $15.40.

Michigan excludes delivery charges, including handling, that are separately stated and recorded, so only the $200 is taxed.

Now change one thing: the seller offers "free shipping" and prices the lamp at $220. In all six states, tax applies to $220, because there's no delivery charge to exclude.

Free shipping, marketplaces and other situations

Free shipping. If you don't charge for shipping, there's nothing to tax or exclude. What matters is the selling price. Building shipping into the item's price means it's taxed as part of the price in every state where the item is taxable.

Shipping on exempt or resale sales. When a buyer gives you a valid resale or exemption certificate, the shipping on that order is exempt along with the goods in Texas, New York, Pennsylvania and South Dakota. Our resale certificate guide covers what to collect.

Marketplace orders. On Amazon, Etsy, eBay and other marketplaces, the platform calculates and collects tax, including on shipping where the state taxes it. You don't add anything. See our marketplace facilitator laws guide.

Dropshipped orders. When a supplier ships directly to your customer, your invoice to the customer controls, but the supplier's charge to you can also carry tax questions. Our dropshipping sales tax guide walks through them.

Use tax. If an out-of-state seller doesn't charge tax on a taxable purchase, the buyer may owe use tax, and New York says the seller's shipping charges are part of the amount subject to use tax.

Nexus thresholds. Shipping charges can count toward economic nexus. Texas, for example, counts separately stated shipping and handling in the total Texas revenue it measures against its $500,000 threshold. Our economic nexus guide has every state's test.

Deciding whether to tax a shipping line

Step 1

Is the item taxable?

Step 2

Does the state tax delivery charges?

Step 3

Separately stated (and optional in Florida)?

Step 4

Tax or exclude

split shipping and handling

Common mistakes and how to fix them

Using one rule everywhere. Many ecommerce platforms let you switch "tax shipping" on or off globally. That's wrong for a business shipping to several states. Use a tax engine or set the rule per state.

Marking up shipping in California. Charging more than the actual carrier cost makes the excess taxable. Either charge actual cost or tax the difference, and keep carrier invoices.

Calling everything "shipping and handling". In California a combined charge forces you to prove which part was postage. Split the lines.

Taxing all shipping on mixed orders. In states that tax shipping, allocate it between taxable and exempt goods, or you'll over-collect. Over-collected tax has to be refunded to the customer or paid to the state.

Forgetting the return deduction. In California you report total sales and deduct nontaxable delivery charges; skip the deduction and you pay tax you didn't collect.

Shipping tax setup checklist

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Official links

What to do next

Check the rule in the three or four states where most of your orders go, fix your invoice wording so shipping and handling are separate lines, and turn on state-specific shipping rules in your checkout. To check a single order, use our sales tax calculator, and for the basics of rates and rounding see how to calculate sales tax.

This is general information, not legal or tax advice — confirm on the official source or with a professional.

Frequently asked questions

It depends on the state. In Texas, New York, Pennsylvania and South Dakota, shipping on a taxable item is taxable even when it's listed separately. In California, Virginia and Michigan, separately stated shipping is generally excluded, though California taxes handling and any amount above the actual shipping cost. If the item itself is exempt, shipping is usually exempt too.

Sources & verification

Figures on this page were checked against the sources below when it was last reviewed on 13 October 2026. Each rate and limit is stored once with its own official source and review date, and official update channels are monitored daily so changes are picked up. How we verify

1.Taxability Matrix: Library of Definitions (Form F0014) — Streamlined Sales Tax Governing Board · accessed 13 October 2026
2.State Taxability Matrix — Streamlined Sales Tax Governing Board · accessed 13 October 2026
3.34 Tex. Admin. Code § 3.303, Transportation and Delivery Charges — Texas Comptroller (rule text via Cornell LII) · accessed 13 October 2026
4.Tax Bulletin ST-838, Shipping and Delivery Charges — New York State Department of Taxation and Finance · accessed 13 October 2026
5.Regulation 1628, Transportation Charges — California Department of Tax and Fee Administration · accessed 13 October 2026
6.Publication 100, Tax Guide for Mail-Order and Online Sellers (delivery charges) — California Department of Tax and Fee Administration · accessed 13 October 2026
7.Fla. Admin. Code R. 12A-1.045, Transportation Charges — Florida Department of Revenue (rule text via Cornell LII) · accessed 13 October 2026
8.61 Pa. Code § 54.1, Delivery charges — Pennsylvania Department of Revenue (rule text via Cornell LII) · accessed 13 October 2026
9.Code of Virginia § 58.1-609.5, Service exemptions — Virginia General Assembly · accessed 13 October 2026
10.Sales and Use Tax Guide (July 2026) — South Dakota Department of Revenue · accessed 13 October 2026
11.Michigan Provides Guidance on Taxability of Delivery and Installation Charges — Sales Tax Institute (secondary) · accessed 13 October 2026
12.Remote Sellers — Texas Comptroller of Public Accounts · accessed 13 October 2026

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We provide tools, guides and information for general educational purposes only. Always refer to official government websites for the latest and most accurate information.