Do I need to collect sales tax if Amazon already collects it for me?

This is the single most misread topic for new Amazon sellers, and the misreading goes in both directions. Some people register in dozens of states they never needed. Others assume Amazon's collection removes every obligation, and find out otherwise when they start selling somewhere else.

What marketplace facilitator laws actually did

Before these laws, the seller was responsible for sales tax on a marketplace sale. The states moved the duty to the marketplace, because collecting from one large company is easier than collecting from a million small ones.

So when someone buys your product on Amazon, Amazon calculates the tax, adds it at checkout, and remits it. You do not touch that money and you do not remit it. That is genuinely settled, in every state that has a state sales tax.¹

What the laws did not do is abolish the idea of registration. Registration is about your relationship with a state. Collection is about a particular transaction. They travel together often enough that people assume they are the same thing.

When you still have to register

Two situations come up repeatedly.

Physical presence. A marketplace seller with physical presence in a state generally is required to register and file there, even though the marketplace collects.² Physical presence is a broader idea than an office: inventory in a warehouse is the version that catches Amazon sellers, because the stock is placed by a fulfilment network rather than by a decision you remember making.

Sales outside the marketplace. The moment you sell from your own website, at a trade show or through a wholesale channel, the marketplace is not in that transaction and cannot collect for it. Those sales are yours to handle, and they are also the ones that build toward a state's economic thresholds.

The guidance that does not override your state

The Streamlined Sales Tax Governing Board publishes the clearest general guidance on this, and states plainly that it is general guidance and does not override any individual state's law.² Forty-six jurisdictions each write their own rules. A sentence that is right in twenty of them can be wrong in the one you are asking about.

That is not a reason to ignore the general shape. It is a reason not to treat any single answer — including this one — as the final word on a specific state.

Forming in a state is not the same as owing tax there

A specific confusion worth naming, because Wyoming is where many Amazon LLCs are formed. The Wyoming Department of Revenue says a licence is needed where you sell something with an imposition statute and have physical presence or connection to Wyoming, outside of a registered agent or virtual office, or meet the economic thresholds — and states directly: “Simply creating a business entity in Wyoming doesn't automatically mean your company needs a Wyoming sales tax license.”³

Read that alongside the registered-agent point. The agent's address is not your physical presence.

If you do need to register in several states

The Streamlined Sales Tax Registration System covers 23 full member states plus Tennessee in one registration, and there are no fees to register in a state where you have no legal requirement to register.⁴

That last clause sounds like an invitation and is the opposite of one, because of what follows it: all states in which you are registered expect returns each reporting period even when there is no tax to report.⁴ Registering in a state you did not need costs nothing on the day and creates a filing obligation that runs until you close it. This is the quiet way a one-person business ends up with two dozen recurring returns.

A separate thing that looks related

Form 1099-K is about income reporting, not sales tax, and arrives from Amazon for a different reason. Third-party settlement organisations, including online marketplaces, report on Form 1099-K when payments for goods or services exceed $20,000 in more than 200 transactions.⁵ Getting one does not tell you anything about your sales tax position, and not getting one does not mean you owe nothing.

What to actually do

1. List the states where your inventory is physically stored. That list is the starting point, not your sales map.
2. List any sales channel that is not a marketplace.
3. Take both lists to someone who does multistate sales tax for a living, once, before you register anywhere.
4. Register only where you are required to, and close registrations you stop needing rather than leaving them dormant.

Lesson 5 of the U.S. course covers this in full, along with resale certificates and what suppliers will ask you for.