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Sales Tax Obligations as an Amazon Seller

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Sales Tax Obligations as an Amazon Seller

Amazon Sellers Have a Duty to Pay Sales Tax: How the Amnesty Program Can Help

In March 2017, there was some unwelcome news that Amazon sellers may be subject to back sales tax in states where they conducted very little business. This can make some Amazon sellers potentially liable fort tens of thousands of dollars. However, an amnesty program began in August 2017 that allowed sellers who owe back tax to avoid penalty. To qualify for this program the seller must clean about their failure to pay sales tax. Recently, the Multistate Tax Commission agreed to extend the deadline for the amnesty program until November 1, 2017. This is due to the fact that sellers aren’t familiar or aware of it, and even many professionals are unsure what to do with the influx of clients/callers worried about their tax liabilities.

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What about the Quill Decision?

A 25-year-old court case, known as the Quill Decision, found that states could collect a tax levy only from organization with a physical presence in their justification. This decision has been the talk among many as it being an unfair advantage to Amazon since its sellers were not collecting sales taxes. However, Amazon began collecting sales taxes in April as it created a nationwide network of fulfillment centers that could process orders for both its direct customers and customers of third-party Amazon sellers.

If you have questions about your sales tax obligation as a third-party Amazon seller, you should contact an experienced Certified Public Accountant. You should also consult with a CPA if you have any questions about the current amnesty program.

If you are an Amazon seller and require the assistance of an experienced Certified Public Accountant, please contact Ebiz Accounting for an initial consultation. 

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