Amazon Sellers Brood as States Come Calling for Taxes
It's a clusterfuck of epic proportions.Let's say you use Amazon Fulfilment (FBA):1. Does just storing goods in a state establish tax nexus in that state? Most states claim it does, but it hasn't been tested in court.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?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't remember which). With all the locations with Amazon warehouses you're looking at 25+ licences. Possibly 40+.4. Let's say you're willing to handle the 40+ business licences you'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.5. Add being a foreign seller (let's say Canadian):- 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't allow you to select a country, require you to select a US state or only accept The One True Zipcode Format.- taxes you remit using ACH will also routinely explode due to a non-US address on your US bank account.- 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'm getting a licence in that case is if I show up in person.- government issued photo id is sometimes required. Guess which government often is the only one that exists ;-)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.