Money, sales tax and addresses · A term for founders abroad
What is a marketplace facilitator?
A marketplace such as Amazon or Etsy that state law makes responsible for collecting sales tax on its sellers' sales.
Checked against the IRS's instructions and the states' own rules. Reviewed by Saais Patel, compliance reviewer.
Term 63 of 105 in the glossary, filed under M.Every term, A to Z
Marketplace facilitator, for a founder abroad.
Every state with a sales tax requires large marketplaces to collect and pay sales tax on behalf of the sellers who use them, so a seller on Amazon, Etsy, eBay or Walmart collects no sales tax on those sales and files nothing for them.
Sales through the seller's own website, on Shopify or a Stripe checkout, aren't covered. They become the seller's responsibility once it has nexus in a state, and in many states marketplace sales still count toward that threshold.
Read next · guide · 3 minSales tax for non-resident sellers: nexus, marketplaces, and when you actually registerWhat founders ask next.
- Does Amazon collect sales tax for me?
- Yes, on your Amazon sales, in every state with a sales tax. Sales through your own website are your job.
- Do marketplace sales count toward my sales tax threshold?
- In many states, yes, which matters if you also sell on your own site. The sales tax guide has the thresholds.
03 · See also
- Money, sales tax and addressesNexusThe link with a state that obliges a seller to collect its sales tax, created by a presence there or by sales above the state's threshold.Read the term
- Money, sales tax and addressesResale certificateA form a registered seller gives a supplier to buy goods for resale without paying sales tax, based on its sales tax registration in a state.Read the term
- Money, sales tax and addressesEconomic nexusSales into a state above its threshold, usually $100,000 a year, which makes a seller elsewhere collect that state's sales tax with no presence there.Read the term
- Money, sales tax and addressesSales tax permitA state registration that lets a seller collect its sales tax and buy stock for resale tax-free; needed once there's nexus, and not a business licence.Read the term
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