Learn the basics of sales tax collection and remittance for Amazon FBA sellers from industry expert Mark Faggiano of TaxJar. This webinar will take the mystery out of a complex topic with serious financial implications for your FBA business. Mark will cover when FBA sellers must collect sales tax, how to determine how much sales tax to collect, and what changes if the current federal sales tax legislation passes. After “Sales Tax Bootcamp,” you will be armed with the tools and resources to take charge of this complicated part of your FBA business.

1. with MARK FAGGIANO
CEO OF
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SALES TAX BOOT CAMP
FOR FBA SELLERS
Your Guide to Getting Sales Tax Compliant

2. GOALS
• Cover some tax basics
• Connect sales tax relates to Amazon
• Share next steps
• Resources for help in the future
• Questions!! (use the chat section to the left)
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3. QUICK INTRO:
• Passion: using tech to solve
problems for small business!
• Founded TaxJar in 2013
• Not a CPA or tax professional
• Talked to thousands of online
sellers, pros, auditors, states
• Here to help you make informed
decisions
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4. WHO I TALK WITH EVERY DAY
• People making a living online
• Multi-channel FBA sellers
• Want to be educated
• Trying to determine where they have nexus
• Sales tax is being collected in different accounts
• Filing returns is a frustrating, waste of time
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5. ”
“
“I want sales tax
to go away!”
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– Average TaxJar Customer

6. SALES TAX BASICS
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7. CHAOS PREVAILS
• No federal laws or governing body (yet)
• 45 states (and DC) = 46 sets of laws
• Nexus
• Taxability
• Rates
• Due dates
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8. 8

9. WHAT’S TAXABLE?
• Tangible items are taxable
• Common exceptions are clothing and food
• Services are mostly not taxable
• Are the tides changing?
• Shipping, gift wrapping can be taxable
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16. PASS-THROUGH TAX
• Pay what you collect
• Never pay out of pocket!
• Sellers are ‘collection agents’
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17. Sales Tax Can Be Automated
Starting is the hardest part
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18. WHAT THE HECK IS NEXUS?
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19. NEXUS IS WHEN/WHY YOU CARE
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A presence / connection in a state that’s
significant enough for you to be required to
comply with their sales tax law

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28. IT’S NOT OVER YET
• Fulfillment is a differentiator
• Amazon is investing in infrastructure
• Passage of federal & state legislation will accelerate
growth of fulfillment centers
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29. WHEN SHOULD I COLLECT
SALES TAX?
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30. GOLDEN RULE OF COLLECTION
Collect sales tax when the item sold is shipped
to a state where you have nexus
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31. MEET JOE SELLER
• Based in Akron, OH
• Only has nexus in OH
• Complying in 1 state

32. Akron, OH Lakewood, OH
Collect sales tax
NEXUS SALE

33. Collect sales tax
REMOTE SALE
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Waltham, MAAkron, OH

34. JOE’S BUSINESS IS GROWING!
• Using a 3rd party fulfillment service
• Inventory stored in NV
• Nexus in OH and NV
• Complying in both states
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35. Collect sales tax
NEXUS SALE
OH or NV OH or NV

36. Collect sales tax
REMOTE SALE
OH or NV Stockport, IA

37. JOE’S USING FBA
• AMZN storing his
inventory in 5 states
• Nexus in 6 states
• Complying in all 6
states

38. Collect sales tax
NEXUS SALE
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OH, NV, CA, AZ, PA, INOH, NV, CA, AZ, PA, IN
REMOTE SALE

39. Collect sales tax
REMOTE SALE
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ANY REMOTE STATEOH, NV, CA, AZ, PA, IN

40. Copyright © 2015 TaxJar. TaxJar is a trademark of TPS Unlimited, Inc.
HOW MUCH SALES TAX
SHOULD I COLLECT?
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41. COLLECTION LOGIC: SOURCING
• State where item is shipped determines tax rate
• Tax rate usually = sum of applicable rates
• State
• Local
• Other (i.e., education, transportation)
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42. ORIGIN VS. DESTINATION SOURCING
• Origin-based state
• Tax rate = seller’s location
• One rate for entire state
• Destination-based state
• Tax rate = where item is shipped
• Variable rate
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43. 43

44. 44

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SELLING ON AMAZON
& SALES TAX

46. GOOD NEWS
• Focus on nexus. Amazon will collect sales tax for you!
• Tax Collection Service in Seller Central
• Product tax codes
• Local taxes
• Cost is 2.9% of tax collected
• If you collect $10 in sales tax, the fee will be $0.29
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47. BAD NEWS
• YOU have to enable collection in Seller Central
• Amazon will NOT tell sellers
• How to collect in FBA states (TaxJar will)
• Where to collect (TaxJar will)
• Easy to collect ‘wrong’
• Collecting only state tax in a destination-based state
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48. FBASALESTAX.COM
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FREE ebook that
includes the collection
settings for every state

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FILING RETURNS
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50. HOW OFTEN DO I FILE?
● Filing deadlines usually tied to sales volume
• The more you collect, the more often you pay
● Frequencies: annual, semi-annual, quarterly, monthly
● Deadlines typically fall on 15-30th of the month
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51. FILING TO THE STATES
• Combine and file a single return per state
• Not separate returns per channel
• File zero returns!
• When you’ve collected $0 in sales tax
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52. PAY ON TIME = $$
Some states have discounts
for on-time payment
• Generally between 1-2%
• It’s free money!
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53. PAY MORE IF YOU’RE LATE
All states have penalties for late payment
• Booo!
• Late payment charges
• Interest on what wasn’t paid
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54. FILING IN DESTINATION STATES
• Huge pain!
• States rely on you to divide up the money collected
• Calculate taxable sales & sales tax collected by jurisdiction
• Gets worse if you’re multi-channel
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55. 55
CA SCHEDULE B

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57. HOW ARE YOU FEELING?
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58. 3/2/16 58

59. WHAT DO I DO NOW?
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60. Head-in-the-sand is not an option

61. Best effort > no effort

62. Don’t drain your
resources trying to
comply

63. HOW DO I GET STARTED?
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64. STEP 1
• Comply in your home state
• Register for a sales tax license
• Enable sales tax collection
• Pay and file
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65. STEP 2
• Branch out to new states
• Voluntary Disclosure of you have a history
• TaxJar can help
• Collect on all channels for your nexus states
• Nexus on one channel means nexus for your entire
business
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66. Slide with expected report
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67. WHO WILL KNOW?
• The decision to comply is up to you
• Risk tolerance is your guide
• States are getting more desperate
• eCommerce is growing
• Legislation is looming
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69. from calculations to reporting & filing
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REGISTRATIONS
& EDUCATION
SMARTCALCS REPORTING AUTOFILE
Painless sales tax compliance for online sellers,

70. Thousands of happy customers, including...
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71. January 11, 2016Copyright © 2016 TaxJar. TaxJar is a trademark of TPS Unlimited, Inc. 71
INTEGRATIONS

72. WHAT ARE YOUR SALES & TAXES COLLECTED BY STATE?

73. WHERE DO YOU HAVE NEXUS?

74. WHAT ARE YOUR SALES & TAXES COLLECTED BY STATE?

75. HOW MUCH SALES TAX DID YOU COLLECT BY JURISDICTION?
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76. ARE YOU COLLECTING ACCURATELY?

78. • 30-day free trial (no credit card required)
• Monthly or annual subscriptions
• Pricing based on transaction volume
• Starts at $19/month for 1k transactions
• $19.95 per AutoFile return
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Get Started…FOR FREE!

79. Helpful resources
79
youtube.com/taxjar
For visual learners
salestaxcommunity.com
Talk with 5,000 other store owners and tax pros!
blog.taxjar.com
Content just for ecommerce & sales tax

80. CALL US!
855-800-6681
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WE LOVE QUESTIONS!