We know these things to be true when it comes to Amazon and sales tax:
- Amazon FBA sellers have complex sales tax requirements because they (for the most part) have sales tax nexus in states where their Amazon inventory is stored
- It can be tough to always know where your Amazon inventory is stored because Amazon moves inventory around from time to time
- Amazon has fulfillment centers (which create sales tax nexus) and sort centers (which do not create sales tax nexus), and it can be difficult to determine which is which when running Amazon sales tax reports.
So we were curious as to how Amazon’s recent announcement that they would buy thousands of their own truck trailers would affect Amazon FBA sellers.
According to an article by Jason Del Rey of Re/Code: “The trailers won’t be used to deliver packages to customer doors. Instead, they’ll be utilized to transport items from one Amazon warehouse, known as a fulfillment center, to another, as well as between fulfillment centers and sort centers, where Amazon organizes orders by zip code to be delivered to local post offices.”
This begs the question: Will Amazon FBA sellers see their shipments moved around even more? Will this means sales tax nexus in more states? Some Amazon FBAers already take the very conservative route of registering for a sales tax permit in every state that has an Amazon fulfillment center. Others wait until they have significant “materiality” in a state. (You can use TaxJar’s Expected Sales Tax report to determine this.)
Stay tuned right here for more as Amazon rolls out their new truck trailers.
Tips for Determining Where Amazon Gives You Sales Tax Nexus
As far as we know, Amazon’s truck trailers aren’t on the highways and interstates yet. But FBAers still need to know where they have sales tax nexus. Use these two methods to find out.
1.) Login to your TaxJar account – Or try a 30-day free TaxJar trial. We’ll show you with brown “Amazon” dashboard badges from which fulfillment centers your products have shipped in the past 30 days. And just send an email to [email protected] if you’d like to see your shipping history from the whole year.
2.) Pull your “Inventory Event Detail” report – This report shows you where your items are in the Amazon fulfillment network on a given day. There are instructions for pulling your Inventory Event Detail report here.
If you find you have sales tax nexus in a state, your next step is to register for a sales tax permit in that state. For more about FBA and sales tax, check out our Sales Tax for FBA Sellers guide.
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