What Are Marketplace Facilitator Laws and How Do They Impact Sellers?

Introduction of Marketplace Facilitator Laws: These laws shift the responsibility of sales tax collection from individual sellers to online marketplaces like Amazon and eBay, simplifying tax compliance for sellers while raising new questions about tax obligations and nexus, particularly for those selling across multiple channels.
Impact on Sellers and Compliance Responsibilities: While marketplaces automate sales tax collection for their transactions, sellers must still manage tax compliance for sales made outside these platforms, monitor their tax nexus in various states, and may need to register and file tax returns if they have economic or physical presence in those states.
Recommendations for Compliance: Sellers are advised to understand their nexus obligations, review marketplace tax reports for accuracy, track multi-channel sales separately, consider tax automation solutions for efficiency, and stay updated on evolving tax laws to effectively manage their sales tax compliance.