States Go After Amazon Third-Party Sellers

DooKey

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It was only a matter of time the states went after third-party sellers on Amazon after they finally got Amazon to pay sales tax to the 45 states that have one. A group of state tax authorities, the Multistate Tax Commission, is trying to nudge Amazon’s sellers to start paying up. They’ve set up an amnesty program for sellers on Amazon and other online marketplaces that would wipe out their back taxes if they start to tax future sales. I wonder how many small businesses on Amazon are going to go out of business over this?

“No one has a clue what to do,” Matthew Turner, a Texas-based Amazon seller, said on a conference call with state-tax officials last month. “I have no time to figure out how to deal with this, and no funds to pay a lawyer or accountant to figure it out for me.”
 

TwiceOver

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I figured Amazon would collect this for them. Also, isn't the "small business" limit for collecting online taxes like $500k in sales?

Oh, and good. All these business should be collecting state taxes.
 

SixFootDuo

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Just a heads up to anyone that uses Facebook Marketplace. Careful how you mark that item once it leaves your possession. Maybe marking it 'sold' might come back to haunt you.

Uncle Sam will be coming after them next if not already.

Actually, on second thought, I don't think you legally have to pay tax on your old used stuff or do you? I should know. I don't.

I've moved over to Facebook Marketplace as my main spot to sell stuff. Mostly stuff I just buy and flip with about 30% being new stuff but of the new stuff I buy and sale, I do pay taxes on some of those items because I have no other choice or I'm under a dead-line.

Facebook Marketplace is actually pretty damn awesome.

Anyone who wants to pay pawn shop prices around the end of the month when rent is due can start shooting all those PS4 and Xbox One owners $100 dollar offers. 90% of the time I get a no. 10% of the time I get a yes.

Anyways, I'm not really in the habit of double taxation.
 

DPI

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Just isn't worth selling on Amazon anymore. Getting squeezed from all sides.

Sell $80 item, deadbeat buyer opens amazon chat (rather than contacting me directly and giving me a chance to resolve issue), and claims "item no longer needed", Amazon CSR sends me rude message to provide buyer return shipping label ($20 in shipping each way), 6 hours later (5am my time, before I even catch wind of it) buyer complains to Amazon again that it's taking too long, and CSR #2 refunds buyer out of my account -- and tells buyer to keep the item.

That's right - the braindead customer service reps now have the power to authorize "refund without return" now on a seller's behalf.

Happy scamming!
 
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w4ffles

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Good luck trying to tax the sellers that aren't even in the country!
 

oldmanbal

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I know amazon has grown substantially since establishing total domination of all sell through using 3rd party sellers, and sucking up most of the issues falls on the customers/end consumer. Taxes have always been a grey issue for online sellers, and it's just another one of the issues dealing with a random seller. It's like walking into walmart to buy batteries from some dude in a trenchcoat who says he'll give you a better deal than the store you are in.

3rd party sellers are a total crapshoot. I ordered a costume and light saber for son from 2 different sellers via amazons main website for this halloween. Both came in defective. The mask was clearly cracked on the top significantly (impossible for the shipper not to see due to small size of box it came stuffed in, and the lightsaber was broken, missing 2 pieces (literally impossible not to notice when picking/shipping the item). Ended up sending them both back on their shipping cost label printout and buying from a local store. Ended up spending the same amount of money locally surprisingly.
 

deeppow

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I understand why states want their tax $s but ..... been an Amazon Prime customer for several years since we live in a small town. Now that Amazon has started charging tax, the typical tax for larger items exceeds shipping costs from other sites so our buying from Amazon has just about stopped.
 

Bandalo

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The internet moved far faster than tax law...tax law is now finally catching up.
 

otherweeb

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_l_

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just wait until they make a move on coin miners. There's no record when you mine but the instant you exchange coins for US dollars ... there's a paper trail
 

DooKey

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Just isn't worth selling on Amazon anymore. Getting squeezed from all sides.

Sell $80 item, deadbeat buyer opens amazon chat (rather than contacting me directly and giving me a chance to resolve issue), and claims "item no longer needed", Amazon CSR sends me rude message to provide buyer return shipping label ($20 in shipping each way), 6 hours later (5am my time, before I even catch wind of it) buyer complains to Amazon again that it's taking too long, and CSR #2 refunds buyer out of my account -- and tells buyer to keep the item.

That's right - the braindead customer service reps now have the power to authorize "refund without return" now on a seller's behalf.

Happy scamming!


WTF
 

Cyraxx

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No physical presence in the state = fuck off.

There are other means of obtaining "Nexus" which si what is used to determine if you are responsible for collecting state sales/use tax... But for the most part I agree. But in this instance, if you're based on Texas and are shipping to addresses in Texas... how fucking stupid are you to act oblivious to the fact that you aren't collecting sales tax?
 

nilepez

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Do they even have a case? Amazon volunteered to do it, because they have a physical presence in many (most?) states. Some peon selling widgets on Amazon probably has a physical presence in their house or a local store and that's it.
 

mope54

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Do they even have a case? Amazon volunteered to do it, because they have a physical presence in many (most?) states. Some peon selling widgets on Amazon probably has a physical presence in their house or a local store and that's it.
Yes, they have a case. They're affiliates of Amazon.
 

JSumrall

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I've worked/ran small businesses before. The idea of having to fill out sales and use tax paperwork each month for every freak'n state you might ship something to is absolutely mind numbing.

Not to mention trying to figure out what exactly the state tax is, finding all of the forms, getting them sent on time, etc.

Sheesh, the entire thought process gives me a headache.
 

SixFootDuo

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I have a good friend that got a 400k judgement against him after his wife divorced him. He had a great job / side business. Her lawyer brought in a forensics accountant and the rest was history. Several weeks after the court dates, paperwork and the dust had settled the court garnishment came in and he said it was massive ( lose your breath ) massive. He said that Friday he put in his two weeks, promptly took 2 weeks of vacation and that was it. Opened up a lawn care business under his parents name who in term made him a low paid employee ( all done legally ) which in turn reduced his garnishment to the courts / wife 10x fold.

I'm sure their was an under the table agreement for this scheme to work ( not sure as no other details were ever shared with me ) but one can only assume.

This was 10+ years ago.

Over the weekend that report on the "Paradise Papers" or whatever it was called came out where it was revealed that several businesses and entertainers used tax shelters to reduce their tax debt and or receive favorable tax breaks.

While the story I just shared might be a bit different it does make one wonder to what extent private citizens will go to reduce taxation and or other relief.
 

SixFootDuo

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I've worked/ran small businesses before. The idea of having to fill out sales and use tax paperwork each month for every freak'n state you might ship something to is absolutely mind numbing.

Not to mention trying to figure out what exactly the state tax is, finding all of the forms, getting them sent on time, etc.

Sheesh, the entire thought process gives me a headache.


Any modern accounting software now does all of this automatically. Not only that. but some of this software will interface with your bank and depending on the state, tax payments can made via electronic xfer. All very streamlined these days and a lot less painless.
 
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