Amazon Sellers Brood as States Come Calling for Taxes
It&#x27;s a clusterfuck of epic proportions.<p>Let&#x27;s say you use Amazon Fulfilment (FBA):<p>1. Does just storing goods in a state establish tax nexus in that state? Most states claim it does, but it hasn&#x27;t been tested in court.<p>2. Assuming it does, Amazon keeps moving your goods between warehouses - how do you keep track which states do you have nexus in and need to have a business license in?<p>3. Assuming you figured it out, in some places you need to register per county, not per state (I believe it was 10+ registrations in one state, can&#x27;t remember which). With all the locations with Amazon warehouses you&#x27;re looking at 25+ licences. Possibly 40+.<p>4. Let&#x27;s say you&#x27;re willing to handle the 40+ business licences you&#x27;re supposedly required to hold, you have to file 40+ tax returns with different deadlines, make 40 payments and keep track of law changes. Also you have to pay to get a business license and often you have to pay to keep it active every year.<p>5. Add being a foreign seller (let&#x27;s say Canadian):<p>- out of all the states with Amazon warehouses only 2 will accept a non-us business address when registering for a business license. The others either don&#x27;t allow you to select a country, require you to select a US state or only accept The One True Zipcode Format.<p>- taxes you remit using ACH will also routinely explode due to a non-US address on your US bank account.<p>- sure, you can file a paper registration (usually at 3+ times the registration fee), unless the state only accepts a XFA PDF form that generates a scannable code. One DOR representative told me the only way I&#x27;m getting a licence in that case is if I show up in person.<p>- government issued photo id is sometimes required. Guess which government often is the only one that exists ;-)<p>By comparison in EU you collect VAT per destination country, remit it to your local tax office indicating where it should go and forget about the whole thing.