Sales Tax for E-Commerce Sellers: Marketplace Facilitator Laws

If Amazon, Etsy, eBay or Walmart collects sales tax on your orders, it is tempting to conclude that sales tax is someone else's problem. For the orders that run through those platforms, that is mostly right. The trouble starts with everything else: your Shopify store, your wholesale accounts, the inventory Amazon moved to a warehouse in another state, and whether marketplace sales count toward the thresholds that decide where you must register.

This article explains what marketplace facilitator laws actually do, where your own obligations remain, and how to keep the books clean so that your revenue, your sales tax liability, and the 1099-K the platform sends the IRS agree with each other.

What marketplace facilitator laws do

A marketplace facilitator law shifts the duty to collect and remit sales tax from the individual seller to the platform that processes the order. Every state with a general sales tax has one, along with the District of Columbia; Missouri was last, effective January 1, 2023. The effect is the same everywhere: on a marketplace order shipped to a customer in Ohio, Amazon calculates the Ohio tax, collects it from the buyer, and remits it under Amazon's own registration. You do not touch it.

Florida's version, in section 212.05965, Florida Statutes, spells out the seller side clearly. Once the marketplace certifies that it collects, a marketplace seller may not collect on those sales and must exclude them from its own return. That matters for your DR-15: marketplace sales are not reported as gross sales, exempt sales, or taxable sales. They are not on the return at all.

Why you may still need your own registrations

The marketplace collects on marketplace orders and does nothing for the rest of your business. If you also sell through Shopify, WooCommerce, your own site, a wholesale channel, a pop-up market, or invoices to business customers, every one of those sales is your responsibility in any state where you have nexus. That means three sets of obligations.

First, your home state. A Florida seller has physical presence in Florida by definition, so it must register with the Department of Revenue and collect on all direct sales delivered in Florida, regardless of volume. Second, any state where you have physical presence through employees, contractors, or inventory. Third, any state where your sales have crossed the economic nexus threshold; most states use $100,000, Texas and California use $500,000, and New York uses $500,000 plus more than 100 sales. A few states also want marketplace sellers registered even when the platform collects everything; Missouri and Nebraska, for instance, may still require registration and reporting.

Do marketplace sales count toward your threshold?

This question decides whether a growing seller has to register in a state, and states answer it differently. Some count everything you ship into the state, including orders the marketplace handled; others count only the sales you collect on yourself. A seller with $70,000 of Shopify sales and $80,000 of Amazon sales into a state is over $100,000 in one type of state and well under it in the other.

Florida's rule took effect July 1, 2021, when the state adopted economic nexus at $100,000 of remote sales in the previous calendar year, with no transaction count. A remote seller with both direct and marketplace sales into Florida measures only the direct sales against that threshold. That is generous, but it comes with the warning we give every FBA seller: if Amazon stores your inventory in a Florida fulfillment center, you have physical presence here and the $100,000 test is irrelevant. For the general concept, see what sales tax nexus is; for a state-by-state view, see our multi-state playbook.

FBA inventory and physical nexus

Fulfillment by Amazon moves your inventory wherever Amazon's network wants it, and most states treat goods sitting in an in-state warehouse as physical presence, the oldest form of nexus there is. Florida says so explicitly for fulfillment center inventory. The prominent exception is Pennsylvania, where the Commonwealth Court held in 2022 that a merchant whose only connection to the state was inventory Amazon had placed in a Pennsylvania warehouse lacked the purposeful contact needed for the state to tax it. That is not a national rule; other states have not followed it.

The practical step is to pull Amazon's inventory and fulfillment center reports at least quarterly and list the states where your goods have been stored. For each one, ask: do I have direct sales delivered there, and am I collecting? If the first answer is yes and the second is no, that state belongs on your registration list, and the exposure runs from the date inventory first arrived.

The 1099-K and your books

Marketplaces and payment processors report your gross receipts to the IRS on Form 1099-K. The One Big Beautiful Bill Act restored the original threshold, and the IRS confirmed it in October 2025: a platform must file when your gross payments exceed $20,000 and your transaction count exceeds 200, for 2025 and later years. Any e-commerce business of real size gets one from every platform and processor it uses.

The number in Box 1a is the gross, unadjusted amount. Per the IRS 1099-K FAQs, it does not net out fees, refunds, shipping, credits or discounts. It will not match the revenue in your books, and it should not. What matters is that you can reconcile the two: gross 1099-K amount, less refunds, less platform fees, less amounts that are not revenue at all, equals what you booked. If you cannot produce that reconciliation, IRS matching will assume the difference is unreported income and send a notice.

Sales tax collected is a liability, not revenue

When you collect $7.50 of tax on a $100 Shopify order, you have $107.50 in the bank and $100 of revenue. The $7.50 belongs to the state and sits in a sales tax payable account until you remit it. Booking the full $107.50 as sales overstates revenue, overstates the profit you pay income tax on, and makes the sales tax return impossible to tie to the general ledger. The fix in QuickBooks is a sales tax liability account that increases with every taxable sale and decreases with every payment to a state, reconciled monthly to the returns filed.

Marketplace-collected tax is different: it never touches your books as a liability, because you never collected it. Amazon's settlement reports show it, but it should not run through your sales tax payable account or your revenue. Clean books show marketplace revenue net of the tax the marketplace collected, platform fees as an expense, and only your own collected tax as a liability. Our monthly bookkeeping checklist includes the reconciliation steps.

Worked example: $600,000 on Amazon, $250,000 on Shopify

Take a Tampa seller of fitness accessories with $850,000 of 2025 sales: $600,000 through Amazon using FBA and $250,000 through Shopify. Amazon collected and remitted tax on every marketplace order, so the seller has no collection duty on the $600,000 anywhere. That leaves the $250,000 of direct sales and the question of where they are taxable.

Florida. Physical presence, so the seller is registered and collects on the $38,000 of Shopify orders delivered in Florida, at each delivery county's combined rate. The Amazon sales stay off the DR-15 entirely.

North Carolina. Shopify sales of $45,000 plus Amazon sales of $75,000. North Carolina counts marketplace-facilitated sales, so the total of $120,000 crosses the threshold. The seller must register and collect on the $45,000 of direct sales; Amazon keeps collecting on its own orders. At North Carolina's combined rates (4.75% state plus local, up to 7.5%) that is a bit over $3,000 of tax a year; not much, but the registration and returns are mandatory once the line is crossed.

Pennsylvania. Shopify sales of $30,000 plus Amazon sales of $80,000. Pennsylvania counts only the direct sales because Amazon collects, so the seller is at $30,000 and does not need to register on economic grounds. The inventory Amazon holds in Pennsylvania warehouses would create physical presence in most states, but Pennsylvania's own courts have said it does not.

Texas. Shopify sales of $28,000 plus Amazon sales of $70,000 total $98,000 against a $500,000 threshold. Texas counts everything, but the seller is nowhere close. However, Amazon's reports show inventory stored in Texas fulfillment centers, and Texas, like Florida, treats that as physical presence. The seller registers in Texas, elects the single local use tax rate, and collects 8% (6.25% state plus 1.75%) on the $28,000 of direct Texas sales, about $2,240 a year.

Total tax the seller collects on its own: roughly $8,000 a year across three states, all of it a liability, none of it revenue. Tax Amazon collected on the $600,000: on the order of $40,000, none of it belonging in the seller's books. And the 1099-Ks from Amazon, Shopify Payments and PayPal add up to more than $850,000 because they include refunds and shipping, which is exactly why the reconciliation exists.

What usually goes wrong

Sellers assume the marketplace's collection covers their Shopify store. They never look at where FBA inventory is stored. They skip the DR-15 in slow months because "Amazon handled it." They book marketplace payouts as revenue, net of fees, so revenue is understated and there is no expense line for the fees. They book Shopify sales including tax, so revenue is overstated. And they hand a tax preparer three 1099-Ks and a QuickBooks file that agrees with none of them. Each is fixable in an afternoon if caught in month two and painful if caught in an audit in year three.

When to get help

If you sell through a marketplace and any other channel, the two questions to answer this quarter are where your inventory has been and where your direct sales have crossed a threshold. If either answer includes a state you are not registered in, you have a cleanup, and the order matters: measure the exposure, consider a voluntary disclosure, then register. Our sales tax compliance service does this work for e-commerce sellers routinely, and our monthly bookkeeping keeps the marketplace, direct-sales and 1099-K reconciliations current so year-end is not a reconstruction project.

Request a 20-minute fit call and bring your Amazon inventory report and a sales-by-state export from Shopify. Those two files answer most of these questions.

Jenny Gao, CPA, EA

Founder of Balance Partners. Florida-licensed CPA and IRS Enrolled Agent with more than a decade of accounting and tax experience. Jenny writes and reviews every guide on this site. About Jenny

This article is general educational information for U.S. business owners and is not accounting, tax, legal, payroll or financial advice for your situation. Rules change and vary by entity, state and facts. Balance Partners, LLC does not provide audit, review or other attest services. Last reviewed September 14, 2026.