Amazon is a popular platform when it comes to achieving online freedom.
Scott Letourneau – Sales Tax System – Voluntary Tax System
One simple thing System How to get your FBA business started Sales Tax Compliance
Attention FBA Sellers
Read the important information below to discover…
Stay Smart and Easy with These Simple Tips Tax For the long-term, your Amazon Business will be compliant and pay zero sales tax
Stop All Your Efforts Tax These simple steps will take away your worries-To-Use Total Compliance Sales Tax System.
Amazon is a popular platform when it comes to online freedom. This platform is used by many families as well as internet entrepreneurs.
It has not only created one of the most advanced fulfillment networks in the world by storing, packing and shipping your products to your customer… it has also provided Amazon sellers with multiple advantages.
One of these is easy access to its huge marketplace, two-Fast delivery and secure payments available within 24 hours
This amazing and lucrative opportunity has soared to nearly $190 Billion online in just a few years.
Consumers could buy products online at a lower price by avoiding sales tax. However, this has led to states losing billions of dollars in uncollected revenue.
This led to most states to ‘get in’ on the enormous revenue pie and started charging all online businesses sales tax. This impacted EVERYONE doing business via the internet, even Amazon FBA sellers.
These new tax policies are now known as the “Amazon laws”, and since they’ve been released, most FBA Sellers and online business owners unfortunately feel like they’re literally waiting to be hung… it’s just a matter of time.
This is because you, as an FBA seller or owner of an online business, must immediately:
- COLLECT Sales tax in the Right amount.
- REMIT That tax to the appropriate state agency.
Sales tax that is due becomes a liability when it becomes past due. sales tax PLUS Interest PLUS penalties, Totalling to a MASSIVE 41 %
SALES TAX = 8 %
INTEREST = 3.3%
PENALTIES = 30%
TOTAL = 41%
Here’s a quick example of a sales tax liability owing Only $5,000 in sales across different states
FBA sellers (or owners of online businesses) can use this tool. State governments will hold you responsible for compliance.
If you’re an established FBA Seller and have NOT collected and paid your sales taxes, you are HEAVILY under water and need to act immediately.
Failure to Remit and Collect Sales Tax What You Need to Do Means You’ll be Obliged to Pay the Sales Tax Liability beyond your OWN POTCKET
This is why it is not possible to operate your business while you are out of compliance. FLUSHING Your Profits down the Toilet!
Choosing to ignore the responsibility of becoming compliant does not free you from being indebted to the collection agency of that particular state… and, it gets worse…
Neglecting You can’t go wrong! Tax Liability You could lose your business and be at risk of bankruptcy.
The State Sales Tax The power to take legal action against you by the department to recover the amount owing plus any penalties or interest is available to them.
Here’s a Typical Sales Tax Audit Scenario:
Let’s say you’re an Amazon FBA seller and you fail to collect or remit sales tax in one of the FBA states, nothing may happen at first, and after a year or two with no audit, you may incorrectly assume that you’re in compliance.
A few years later, when the state tax agency eventually searches your business and does a manual audit, you’ve now entered their taxation audit process and are legally bound to co-Work together, cooperate and conform.
The sales tax auditor will ask you to immediately pay all uncollected taxes (plus any costs). The longer you take to pay, the bigger the amount you’ll be forced to pay in the long run.
Anyone Who’s Been Audited from the Tax Department admits it will be a difficult fight to recover.
In a perfect world, you’ll get audited in the first year of business, keeping your taxes and penalties down.
However, we’ve seen many cases taking 7-It took 10 years for the audits to reach businesses with a bad surprise.
At that point, it’s generally too late for business owners to recover because the tax agency assesses every single transaction from day one, which generally accumulates too big of an amount for the business owner to pay, causing the destruction of that business plus personal litigation.
What and when does it matter? Sales Tax Not enough funds?
When you collect sales tax, you must remit it. The nexus. No nexus? No problem. You’re off the hook for sales tax.
If you DO NOT have nexus but you still trade in FBA states, sales tax becomes your responsibility.
What is the nexus?
It’s just a fancy way of saying you’re obliged to collect and pay sales tax by the tax office in a given state.
Basically, you have nexus in each and every state where your business benefits from that state’s services or infrastructure.
Examples are using that state’s roads or bridges, sending your staff there for any business reason, and/or storing products in a warehouse in that state (yes for Amazon sellers).
FBA business owners have generally nexus (tax liabilities) in the home state you reside in and the states that your products are stored.
Note: There are only five states in the US that don’t have nexus:
- New Hampshire
If you are NOT in one of these states and use Amazon’s FBA service, then you have sales tax nexus and are required to collect and remit sales tax in your business.
There’s more Sales Tax?
If you have been selling for 6 months or longer, and have NOT collected or remitted sales tax, you’re not alone. This is a common problem for new businesses just starting out. It’s also likely you had the wrong information and didn’t even know that collecting and remitting sales tax was required.
The bad news is that you can’t get into compliance quickly. This could spell financial disaster for your company.
You are NOT collecting and remitting each day Sales Tax You are responsible for the following in the States Where You Nexus Sales Tax That’s Accruing.
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