4

I'm interested in becoming a 3rd party Amazon FBA (fulfilled by Amazon) seller. I recently learned about a rule called "nexus". Basically, I understand I have nexus (tax liability) in the state where I live OR have inventory.

This website lists 24 states where FBA sellers must register as a business. http://www.fbasalestax.com/fba-state-sales-tax-licenses/

As a single person small business owner, it's not possible for me to file taxes in 24 states per quarter. My entire business would become filing taxes.

I have heard conflicting opinions. Some people say Amazon is liable for these taxes not the 3rd party seller. Others say the law is still developing and/or unclear.

Basically, can I register with the comptroller in just my state (Texas) and do FBA business? Or is FBA simply not a viable option for small businesses?

Improve this question
3
  • "My entire business would become filing taxes." I'm sure there are companies which provide that service. For a fee, of course, which would eat into your profits...
    – RonJohn
    Dec 2, 2017 at 14:11
  • That OR is critical (I think it's supposed to be inclusive). There should be clarifying language. That website is a for profit website, probably offering the services as @RonJohn mentions. But basically, keep in mind that with FBA, you mail your products to an Amazon warehouse. That warehouse is where you have inventory. As long as you only send to that one warehouse, you'll only have tax liability there, and where you live/operate. I'm pretty sure that you wouldn't have to file in all 24 states, unless you have inventory in all. Bottom line: ask a real lawyer.
    – Xalorous
    Dec 4, 2017 at 18:27
  • @Xalorous - As an FBA seller the location is not your decision. It's not even straight forward to discover where your inventory is at a given point in time.
    – P.Brian.Mackey
    Dec 5, 2017 at 4:02

0

Reset to default

You must log in to answer this question.

Browse other questions tagged .