EP 8: Sales Tax Collection Updates for Amazon.com with Peter Mantell
Marketplace Blueprint: Product Marketing Strategies for Amazon
Release Date: 09/23/2019
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info_outlineAmazon announced 10 new states they will be automatically collecting sales tax
As of October 1st Amazon will be automatically collecting and remitting sales tax in 10 additional states. This has left many Amazon retailers confused on how this will affect them going forward. In this episode, Peter Mantell of Ampersand Accounting shares some general recommendations for retailers as they adjust to this new development for some states with large sales tax implications for Amazon sellers. Note: Nothing in this episode should be taken as specific tax or legal advice. Contact your licensed professional to identify the next best steps for your state. The purpose of this podcast is solely that you have the information to work with tax and legal professionals for your company.
Do I still need to file in states Amazon is collecting sales tax?
The answer to that question is really, it depends. Some states still want sellers to remit a filing, even if Amazon is collecting and remit the actual tax. Some states, like Texas, have said that since they don't feel selling on Amazon creates a nexus for retailers they are allowing sellers to de-register. If you are continuing to file in that state you would simply mark your Amazon sales as exempted sales.
What types of sellers on Amazon need to think about sales tax compliance?
Not all products being sold on Amazon will put the seller at a potential sales tax liability. On platforms and programs that Amazon is the seller of record (Vendor Central, KDP, etc) those vendors do not have any potential sales tax liability from those Amazon sales. If you are the seller of record, then you should talk with a SALT tax professional to discuss potential sales liability. Overall: No potential sales tax liability: Vendor Central, Sold By Amazon, Kindle/CreateSpace Potential sales tax liability: Seller Central (with the exception of Sold By Amazon)
Other Areas Discussed
We also discussed considerations before going to register with the remaining states that Amazon is not currently collecting, California back taxes, and economic vs physical nexus.
Amazon's Actual Announcement
Amazon's announcement around this happened on Seller Central. Here is an excerpt of that announcement:
Tax collection for orders shipped to the states of AZ, CA, CO, ME, MD, MA, NV, ND, TX, UT - Effective October 1, 2019
Based on changes to Arizona, California, Colorado, Maine, Maryland, Massachusetts, Nevada, North Dakota, Texas, and Utah State tax laws, Amazon will begin calculating, collecting, and remitting sales and use tax for all orders shipped to customers in these states on October 1, 2019. Your existing tax calculation settings, order details, and payments reporting will update automatically to reflect this change. Changes to your tax settings or seller account are not required based on the state law changes. However, you may consider working with your tax advisor to determine if your business has any other ongoing tax remittance or reporting obligations. Answers to common questions are available in the Marketplace Tax Collection FAQ.
Which States Is Amazon Collecting and Remitting for As of October 1st, 2019
State | Effective Date | State Resource |
---|---|---|
Arizona | October 1, 2019 | Link |
California | October 1, 2019 | Link |
Colorado* | October 1, 2019 | Link |
Maine | October 1, 2019 | Link |
Maryland | October 1, 2019 | Link |
Massachusetts | October 1, 2019 | Link |
Nevada | October 1, 2019 | Link |
North Dakota | October 1, 2019 | Link |
Texas | October 1, 2019 | Link |
Utah | October 1, 2019 | Link |
Ohio | September 1, 2019 | Link |
Arkansas | July 1, 2019 | Link |
Indiana | July 1, 2019 | Link |
Kentucky | July 1, 2019 | Link |
New Mexico | July 1, 2019 | Link |
Rhode Island | July 1, 2019 | Link |
Virginia | July 1, 2019 | Link |
West Virginia | July 1, 2019 | Link |
Wyoming | July 1, 2019 | Link |
Vermont | June 6, 2019 | Link |
Idaho | June 1, 2019 | Link |
New York | June 1, 2019 | Link |
South Carolina | April 29, 2019 | Link |
Nebraska | April 1, 2019 | Link |
District of Columbia | April 1, 2019 | Link |
South Dakota | March 1, 2019 | LinkCertificate of Collection |
Alabama | January 1, 2019 | Link |
Iowa | January 1, 2019 | Link |
Connecticut | December 1, 2018 | Link |
New Jersey | November 1, 2018 | Link |
Minnesota | October 1, 2018 | Link |
Oklahoma | July 1, 2018 | Link |
Pennsylvania | April 1, 2018 | Link |
Washington | January 1, 2018 | Link |
Looking for support, training, or someone to handle your Amazon channel sales for you?
Contact us at MarketplaceBlueprint.com for more information.
We have case studies of our work with a variety of Amazon accounts on both Amazon Vendor Central and Seller Central.
You can also visit our Marketplace Blueprint Blog and schedule an appointment with Robyn.