Amazon Terminating Louisiana Affiliates
Louisiana recently passed a law that would require Amazon to collect sales tax if they continued to use affiliates in that state. Rather then collect sales tax, they appear to be terminating their affiliate program in Louisiana.
I've spoken with one affiliate who received her termination notice Friday. (Note: check your email and look for a notification from Amazon - contact them if you don't see a notice but live in Louisiana!)
She contacted the Amazon Associate support desk and when she asked if she could have her brother (who lives in another state) open an affiliate account using her site and switch the links to his account, they gave her an interesting alternative.
The rep suggested she simply transfer her existing account to her brother before the termination date of April 1st.
I've never heard of that being an option for folks before but it makes sense. There are tax implications, of course - the income from the account gets reported under the brother's name, etc. Anyone in such a position would want to do their own research on any income tax impacts. However, it's an option to keep in your back pocket should you live in Louisiana. It also allows for the tracking IDs and reports to all be protected. Once the account is terminated that data is wiped out.
As Amazon has begun to collect tax in more and more states, I'd hoped we'd reached a point where this wouldn't happen as often but the Louisiana example highlights that a couple of other states are also at risk.
Nebraska and Utah are working on similar bills.
South Dakota is also considering sales tax legislation that would have an impact on Amazon but their approach seems slightly different. I'm not sure it has the same impact on affiliates but those in SD should pay attention just in case.
It's no fun when this happens, but it does happen. If you're in an impacted state you have several options I can think of at the moment:
I've spoken with one affiliate who received her termination notice Friday. (Note: check your email and look for a notification from Amazon - contact them if you don't see a notice but live in Louisiana!)
She contacted the Amazon Associate support desk and when she asked if she could have her brother (who lives in another state) open an affiliate account using her site and switch the links to his account, they gave her an interesting alternative.
The rep suggested she simply transfer her existing account to her brother before the termination date of April 1st.
I've never heard of that being an option for folks before but it makes sense. There are tax implications, of course - the income from the account gets reported under the brother's name, etc. Anyone in such a position would want to do their own research on any income tax impacts. However, it's an option to keep in your back pocket should you live in Louisiana. It also allows for the tracking IDs and reports to all be protected. Once the account is terminated that data is wiped out.
As Amazon has begun to collect tax in more and more states, I'd hoped we'd reached a point where this wouldn't happen as often but the Louisiana example highlights that a couple of other states are also at risk.
Nebraska and Utah are working on similar bills.
South Dakota is also considering sales tax legislation that would have an impact on Amazon but their approach seems slightly different. I'm not sure it has the same impact on affiliates but those in SD should pay attention just in case.
It's no fun when this happens, but it does happen. If you're in an impacted state you have several options I can think of at the moment:
- Sell your site
- Transfer your Amazon account to someone else (talk to them first to find out how and research your tax implications)
- Sign up with a different affiliate program and replace the Amazon links in your site (you're usually limited to affiliate programs for retailers that have a physical presence in your state so think big box stores like Home Depot, Target, Walmart)
Sid Hale
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