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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.

Read the explanation See the 2 questions

Checked against the IRS's instructions and the states' own rules. Reviewed by Saais Patel, compliance reviewer.

Topic
Money, sales tax and addresses
Questions
2 answered
Sources
Named in text
Reviewed by
Saais Patel

Term 63 of 105 in the glossary, filed under M.Every term, A to Z

01 · Explained

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 register
02 · Questions

What 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.

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