Sales tax, resale certificates and when you need a CPA

Tax is where beginners either panic or ignore the subject entirely, and both reactions cost money. The panicked seller registers in twenty states and inherits twenty filing obligations. The relaxed one discovers a problem three years later with interest attached. The useful position is in between, and it starts by separating three things that get called “tax” in the same sentence.

Three different taxes, and a report that is not a tax

• Sales tax is a state tax on the customer's purchase. You never pay it out of your margin; you collect it and pass it on — except that on Amazon, Amazon does that part.
• Income tax is federal and sometimes state, on profit, and it is yours. Whether your profits are taxable in the United States depends on facts covered later in this lesson.
• Customs duty applies when goods cross the border into the country. It belongs to lesson 9, and in 2026 it changed dramatically.
• Form 1099-K is not a tax. It is a report a marketplace files about payments it sent you. For 2026, marketplaces report when payments exceed $20,000 in more than 200 transactions.¹ Receiving one changes nothing about what you owe; it only means the IRS has the same numbers you do.

Why Amazon already collects your sales tax

Every U.S. state with a sales tax — all 45 of them, plus the District of Columbia — now has marketplace facilitator legislation, with Missouri the last to take effect on 1 January 2023. Under those laws the marketplace, not the seller, is responsible for calculating, collecting and remitting sales tax on sales made through it.²

For a seller whose only channel is Amazon, this removes most of the work. You are not calculating rates by zip code, you are not filing forty-six returns, and the money never passes through your account. It is genuinely one of the few pieces of good news in this course.

What can still land on you

Guidance published by the Streamlined Sales Tax governing board, which many states participate in, sets out the general pattern. For a seller with no physical presence in a state who sells only through a marketplace, most states do not require registration, and do not require returns, because the facilitator is collecting. Where the seller does have physical presence in the state, registration is generally required. The same guidance notes that in most states, sales made through a marketplace facilitator do not count toward the seller's own remote-seller threshold. It also states plainly that this is general guidance which does not override any individual state's law.³

So the practical question becomes: do you have physical presence anywhere? Three situations create the argument.

1. You live or work in a state. Unambiguous.
2. You hold inventory in a state — your own warehouse, or a prep centre you contract with.
3. Your inventory sits in Amazon's fulfilment centres, which are spread across many states, and Amazon moves it without asking you. Whether that creates nexus for the seller has been argued between states, sellers and the courts for years, and the answer is neither settled nor uniform.

Why registering everywhere is the wrong instinct

The intuitive safety move is to register in as many states as possible, in case. Consider what registration actually does.

The Streamlined Sales Tax Registration System lets one registration cover the 23 full member states plus Tennessee, and it charges nothing to register in a state where you have no legal requirement to do so. But it is equally explicit about the consequence: all states in which you are registered expect you to file returns each reporting period even if you have no tax to report.⁴

Read that twice. A registration you did not need becomes a recurring obligation to file zero returns, forever, in every state you ticked — and a missed zero return can still generate a penalty notice. Registration is not free insurance. It is a commitment.

The resale certificate your supplier will demand

When you buy stock to resell, you should not pay sales tax on that purchase — tax is due once, when the end customer buys. The document proving that is a resale certificate, and a wholesale supplier will ask for one before opening a trade account. To them it is not a nicety: without it, they are liable for the tax they did not charge you.

The Multistate Tax Commission publishes a Uniform Sales & Use Tax Resale Certificate, and 36 states have indicated it can be used as a resale certificate. The Commission is careful to add that the form carries specific requirements and limitations, and that you should confirm with the revenue department of the state in question whether it will be accepted.⁵ Several states will only accept their own form, and many expect a registration number issued by a state.

Which produces the knot that non-resident sellers hit: a certificate usually references a sales tax registration, and you may not have one, because you may not need one. There is no clever trick here. The realistic options are to register in a state where you genuinely have an obligation or a real connection, to use the uniform certificate where the supplier and state accept it, or to ask the supplier what they will accept — many have seen this before and have a preferred route.

Federal tax, and Amazon's tax interview

Amazon requires a tax interview before it pays you. For a U.S. person that ends in a W-9. For a foreign entity, the relevant form is W-8BEN-E, which the IRS describes as the form foreign entities use to document their status for U.S. tax withholding and reporting. It goes to the withholding agent — here, Amazon — and not to the IRS.⁷ Complete it accurately: it is a signed statement about who you are.

Whether your profits are then taxable in the United States is the question lesson 2 declined to answer in one line, and this lesson will decline too, for the same reason: it turns on how and where you operate and on the treaty, if any, between the U.S. and your country. What is certain is the paperwork from lesson 2 — a foreign-owned single-member LLC files Form 5472 with a pro forma 1120 every year regardless of profit, and the penalty starts at $25,000.

When to actually hire someone

Hire a CPA who works with non-resident owners and marketplace sellers if any of these is true, and they probably are:

• Your LLC has a foreign owner. The 5472 filing is not optional and not difficult to get wrong.
• You use FBA and want a defensible position on inventory and nexus.
• You sell anywhere besides Amazon.
• You have or plan to have staff, contractors or a warehouse in the United States.
• You have already been registering in states without a clear reason, and want to unwind it safely.

The fee is a fraction of one penalty, and the useful output is not a tax return. It is a one-page note saying which states you are registered in, what you file and when, and why.

Mistakes that cost the most

• Registering in many states “to be safe”. Every registration is a recurring obligation to file, even with nothing to report.
• Assuming Amazon's collection covers all your sales. It covers sales made through Amazon. Nothing else.
• Treating a 1099-K as a tax bill. It is a report; the threshold for 2026 is $20,000 and more than 200 transactions.
• Believing a Wyoming LLC needs a Wyoming sales tax licence. The state says otherwise, in writing.
• Filling the tax interview carelessly. W-8BEN-E is a signed declaration of status, not a formality.
• Buying stock without a resale certificate the supplier accepts. You pay tax you should not have paid, and it comes straight out of margin.
• Deciding the FBA nexus question yourself. It is the one area where confident internet answers are most often wrong.

Next

Lesson 6 opens the Seller Central account itself: the documents, the identity video call, why registrations get refused, and what to do when the account lands under review.