Arkansas Affiliate Nexus Tax: Starting June 9 2011

13 years ago

The same is happening to me in Illinois. Amazon sent me a letter when the legislation was just PROPOSED. Now that it's PASSED, I'm awaiting the final cutoff from them and have ceased working on any Amazon-related projects.

I suspect a lot of states will take this position going forward. Eventually Amazon and others will have to give in and let their affiliates reside in any state, because otherwise they won't have enough affiliates!

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Carlsbadd

13 years ago

Look to incorporate in Delaware or Nevada.

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CDarklock

13 years ago

Originally Posted by Carlsbadd

Look to incorporate in Delaware or Nevada.

Alaska, Delaware, Montana, New Hampshire, and Oregon... have no state sales tax.

So nothing to worry about in those states.

And if all your apples are in the Amazon basket, Washington state is their HQ and they have to collect sales tax here anyway - so it's perfectly safe to be an Amazon affiliate around Seattle.

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AnniePot

13 years ago

Originally Posted by CDarklock

Alaska, Delaware, Montana, New Hampshire, and Oregon... have no state sales tax.

So nothing to worry about in those states.

And if all your apples are in the Amazon basket, Washington state is their HQ and they have to collect sales tax here anyway - so it's perfectly safe to be an Amazon affiliate around Seattle.

Texas also has no state tax, but I thought the issue was related to charging sales tax - am I wrong? :confused:

As for addresses in another sate wouldn't something like this work? http://www.mailboxforwarding.com/

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Bruce NewMedia

13 years ago

Originally Posted by AnniePot

Texas also has no state tax, but I thought the issue was related to charging sales tax - am I wrong? :confused:

As for addresses in another sate wouldn't something like this work? Mailbox Forwarding - View Postal Mail Online, Mail Forwarding, Mailbox Rental, and Virtual Address PO Box Services

Texas has no state INCOME tax, this is about states with SALES tax. (or no sales tax)
_____
Bruce

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donhx

13 years ago

Originally Posted by CDarklock

Alaska, Delaware, Montana, New Hampshire, and Oregon... have no state sales tax.

So nothing to worry about in those states.

And if all your apples are in the Amazon basket, Washington state is their HQ and they have to collect sales tax here anyway - so it's perfectly safe to be an Amazon affiliate around Seattle.

Actually, not true. A part of this money grab by states is to have people/businesses pay "destination sales tax." That is, wherever you may be, you must pay and/or collect sales tax, and remit it to the state where the buyer resides.

This "destination tax" already exists within California and Washington State (Destination-based Sales Tax) where sales taxes differ by county and some local jurisdictions. Buy a car in one county, for example, but you have to pay the sales tax rate in the county where you reside not where you bought it.

While this is now happening within states, it will be happening between states if the U.S. Congress passes what is called the "Main Street Fairness Act." You can Google that.

Even WalMart and Target want people to pay online sales tax and are trying to get Amazon to comply. Interesting article on that here: Al Norman: Wal-Mart Wants You to Pay Online Sales Tax

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Eyetrap

13 years ago

Ok, I've just setup a new business license and a DBA in Missouri for $7.

I used my dads address in Missouri because you need to have a physical address, not just a PO BOX. (If you don't know anyone in another state, I guess you could try to get cheap rent for an office space you'd never use for the physical address.)

Next and final step is a bank account in Missouri.

-
Missouri Secretary of State Robin Carnahan :: Corporations Division :: Fictitious Name Registration FAQ
-

Nice try Arkansas, but you didn't screw me this time. In fact, Arkansas will now lose all my state income tax money.

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Kay King 13 years ago

I think within five years some of these states will look back and wonder what they were thinking - while a few other states will profit from the exodus of business. People who can afford to pay higher taxes can also afford to move out of state.

A financial news show recently displayed stats from a state that greatly increased the taxes on its wealthier citizens and on businesses 2-3 years ago. Not surprisingly, the stats show that many of those wealthy residents and businesses had left the state entirely. I can't remember which NE state it was but the numbers clearly indicated many people today won't sit quietly while their income potential is eroded.

kay
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- dfs_dean 13 years ago
  
  Be sure to think the out-of-state business all the way through. You'll get 1099s with the out-of-state address, so when it comes time to file state and federal income tax returns you will need to be sure all your documentation is in sync. For example, you might have trouble taking a mortgage interest deduction if you end up filing in Missouri when the property is really in Arkansas.
  
  But I'm certainly not a tax professional so don't pay attention to anything I say.
  
  Rather than opening a bank account in Missouri, might it be easier to open an account with an online company like ING Direct or a similar company?
  
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Tsnyder

13 years ago

Originally Posted by Eyetrap

Ok, I've just setup a new business license and a DBA in Missouri for $7.

I used my dads address in Missouri because you need to have a physical address, not just a PO BOX. (If you don't know anyone in another state, I guess you could try to get cheap rent for an office space you'd never use for the physical address.)

Next and final step is a bank account in Missouri.

-
Missouri Secretary of State Robin Carnahan :: Corporations Division :: Fictitious Name Registration FAQ
-

Nice try Arkansas, but you didn't screw me this time. In fact, Arkansas will now lose all my state income tax money.

I think you're playing with fire. If I were in your position I'd
be seeking legal advice. If you remain physically in the state
of Arkansas I doubt a DBA with an address in MO will relieve
you of Arkansas state tax liabilities. A DBA is still you.

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AmyDavis

13 years ago

Look into using SkimLinks to retain amazon affiliate product links on your site.

Skimlinks is an amazon affiliate and you become a Skimlinks sub-affiliate. Amazon pays Skimlinks and they pay you. Your residence does not come into play. You will get a slightly lower payout which is better than no income at all.

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Iemagine

13 years ago

Originally Posted by AmyDavis

Look into using SkimLinks to retain amazon affiliate product links on your site.

Skimlinks is an amazon affiliate and you become a Skimlinks sub-affiliate. Amazon pays Skimlinks and they pay you. Your residence does not come into play. You will get a slightly lower payout which is better than no income at all.

Thanks Amy! I'm looking into this now.

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Jason Perez O'Connor

13 years ago

It just gets better for those of us outside the US

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AmyDavis 13 years ago

Originally Posted by Jason Perez O'Connor

It just gets better for those of us outside the US

Absolutely right! I don't think legislators realize that Amazon can do very well with no US affiliates. There are plenty of folks outside the borders.
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bitriot

13 years ago

My buddy works at best buy - Companies like best buy, walmart and so on have teamed up to jam through this legislation to theoretically level the playing field for brick and mortars. Doubt it is gonna do much aside from get me to rent a nevade mailbox and then a texas mailbox and then a...

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Iemagine

13 years ago

Originally Posted by Eyetrap

Arkansas just passed the affiliate tax on April 1 and it goes into effect on June 9th. I just received this message from buycostumes.com yesterday, I'm assuming Amazon and others will send me one soon.

My wife is an accountant and has lots of accounting friends, we are looking for the cheapest, quickest method for me to "setup" a location in another state ASAP. I'll report back what I end up doing here.

This was passed here in Arkansas because Walmart's home office is here.

=============================
Notice from BuyCostumes.com
Re: Arkansas Affiliate Nexus Tax
Due to the recent Affiliate Nexus Tax law that has passed in the state of Arkansas, we must sadly inform you that BuyCostumes.com will no longer be able to work with affiliates from Arkansas, effective June 1, 2011.

We view all of our affiliates as an extension of our Marketing team, so please understand that this situation has not been taken lightly. You have been a wonderful asset to our company and this decision has no correlation with your perforamance as our partner. Unfortunately, the tax legislation has forced us to make this very tough business decision.

We'd appreciate the opportunity to keep in touch and if this legislation is ever repealed or overturned, we would love to discuss the possibilty of working with you once again.

Please reach out to me directly if you have any questions.
=============================

I'm also in Arkansas and I'm aware of this new law. I'm moving all of my business to Nevada after talking to my accountant and lawyer.

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ladyash 13 years ago

Hi, I have also lost my Amazon affiliate account. I had a lot of affiliate sites, with Amazon products. I am in
Arkansas, also. I noticed a lot of discussion about Nevada. I have looked into a filing of a corporation there.
But, I am not sure, about a physical address. No relatives there, though, Does anyone know the answer to that, does the incorporator have to have a Nevada Address?

Thanks,

Judy (ladyash)
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kbrockm

13 years ago

Does anyone know how this affects someone who lives elsewhere but has a supplier in Arkansas? Will we now have to charge Arkansas residents sales tax? If you can, please include a link to the governmental page documenting this? I can't seem to find it at the state's business pages.

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SocialMediaOwls

13 years ago

Arkansas has internet?

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Arkansas Affiliate Nexus Tax: Starting June 9 2011

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