Amazon Affiliate Program Dead In California Now!?

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Hi,

I read an article that states that amazon will not allow affiliates soon in the state of california in this article:

Web-only - Amazon warns it will leave California affiliates over tax law - Internet Retailer

If so does this mean people who live in california cannot sale amazon products? I have family that lives in georgia, could I simply just send my checks there and still work in Cali? This sucks
#main internet marketing discussion forum #affiliate #amazon #california #dead #program
  • Corey,

    There's a huge number of threads on Amazon's tax battles many of which will give some ideas for if California goes down. Here are just a few of the most recent:

    http://www.warriorforum.com/main-int...her-state.html

    http://www.warriorforum.com/main-int...ffiliates.html

    http://www.warriorforum.com/main-int...ffiliates.html

    http://www.warriorforum.com/main-int...nnecticut.html

    http://www.warriorforum.com/main-int...residents.html

    Nigel
    • [ 1 ] Thanks
  • Corey,
    I feel you pain - I have several Amazon sites that are just starting to generate some real good income because they are starting to rank on the first page of Google for my selected keyword phrases.

    Right now I'm debating on whether to switch out the Amazon links with other affiliate programs from a site such as Commission Junction or just go with adsense only on the sites.

    I'm also considering flipping the sites to a marketer that resides in a state that Amazon will still support.

    At some point I do think Amazon will need to re-evaluate thier decision because entually if they have no affiliates promoting them I believe their profits will dip.

    Respectfully,
    Tim
    • [1] reply
    • Instead of waiting to get whacked:

      1. Subscribe to a mail forwarding service in a state that does not have income tax. Oregon is close by.

      2. Change the address in your Amazon account.

      3. Do it right now. Seriously - right now. I took care of this long ago. There is no excuse for people to get warning after warning, see the train coming, coming closer, and then get run over.

      (For obvious reasons, not legal advice. Just practical, real-life advice about putting food on the table for your family.)

      FYI - CJ may not do you a lot of good since it is a California company. The last proposal vetoed by Schwarzenegger a couple years ago would have caused any merchant using a CA based merchant network like CJ, regardless of where an affiliate is located, to pay California sales tax. You may want to read that last sentence again.
      • [1] reply
  • These new state legislations are eventually going to seriously impact Amazon's affiliate generated business. Until recently, I lived in California (I was there for many years), but I have to say that at the moment they seem to be getting top heavy with their new tax legislation.

    How does it benefit these states if they shut down affiliates working on behalf of Amazon? These affiliates will have their incomes seriously curtailed and as a result, pay less income taxes. The cutting off the nose to spite the face syndrome!
    • [1] reply

    • Annie,

      I live in Illinois and totally agree. I think they estimated 9000 Amazon affiliates in Illinois who now won't be paying income tax on their earnings. That's a loss of millions.

      I think if Amazon loses their court case in New York (I think it's New York) then this move by states could snowball.

      I also think the Big Box stores are pushing this legislation

      Sandy
  • Thanks guys. My parents live in Georgia though so I should just be able to send the checks there right? I mean how will amazon know that im not the one getting the checks? It's basically "I do live in Georgia" because my address and info says I do. Am I wrong here?
    • [1] reply
    • Corey,
      You can probably do that but it may just be a short term solution for a growing problem.

      Respectfully,
      Tim
      • [1] reply
  • If anything, these Amazon changes should be a problem for Amazon and not the affiliates. There are lots of other physical product distributors. You may argue about the low price, but have you ever called a manufacturer in China. Set up a drop ship service and you are back on track more than likely making more commission than before.
  • But if we want to sale phyiscal products whos the next best vendor? Im thinking amazon converts better because of the trust issue and reviews for products. I don't know what to do I was seeing some results with amazon and was pumped to start creating a lot of sites! I wonder if Cali will even be canceled or not.
  • is this going to happen to all phyiscal affiliate products? Whats a good alternative to amazon that converts just as well too? Thanks
  • does anyone know if say commission junction or say target.com products convert as well as amazon? Just wondering if anyone has any experience for this? I dont want to start building these amazon sites if they are just going to go down.
  • Corey, Amazon should send you an email if and when they dump CA affiliates. If they haven't already, it's probably coming soom... sadly.

    I do very well with CJ.com. There are other ways to make money besides just Amazon.

    I'm not sure if you could legally have your Amazon checks sent to Georgia. You SS number and tax papers will show one state and address and your payments another state and address.

    The whole thing is just blah for Amazon affiliates....

    Cindy
  • Thanks Cindy. Does CJ have a ton of products like amazon? Also do they convert as well as amazon? Thanks
  • If your commissions are big enough, sign up for a mail forwarding service. You can have an address of your choice.
  • I have a address in Georgia. My commissions right now arn't big but I see big potential with amazon. They convert well and I have my "own little system" set up to build new amazon sites I can't move back to Ga but my family still lives there.
    • [1] reply
    • This has nothing to do with the Amazon Affiliate program, but I was working for a company in California that got bought out by Amazon, and last year they closed down the California offices because of "California Taxes"
  • Simple solution guys.


    As I live in Australia, just whack my code on your sites for a 50/50 split.
    C'mon, you trust me don't ya?
    • [1] reply
    • actually thats not a bad idea in some ways,lol. But we would have the same tax issues I think when I did the tax papers etc right? Besides that couldnt you just find a trusted warrior and offer something like 5% just to use their account? I mean if someone is making 5k a month thats a few hundred bucks a month profit for the other guy
  • How come New York didn't close the program down? Im wondering how long it will take to find out if California residents cannot be affiliates.
  • This is just another example of politicians not understanding the things they're trying to regulate. State after state keeps inacting these type of tax laws and the only result is to close down opportunities for their residents.

    If they want to require the affiliates to declare the income and pay taxes at the end of the year themselves it would be one thing, but trying to force the internet companies to bother with reporting requirements in each state, it's simpler for them to just refuse to accept affiliates for those states. It's happened enough for the legislators to understand that will be the consequence and yet they keep trying it anyway.

    It's a very short-sited approach and the politicians should be held accountable for it. Rather than increasing tax revenues, they're actually losing the tax money that would have been paid by the affiliates spending their earnings in the state. Voters should start taking note of how stupid this is and start kicking the ones responsible out of office when it comes time to vote.
  • Corey, GA may only be a very short term solution. If you do some searching you'll find that they have a tax commission meeting coming up and this type of bill is on the docket. Until the NY case is eventually settled, which could be years down the road, Amazon will continue to dump affiliates in every state that passes this tax legislation. I just lost a big part of my business here in IL, so I know firsthand how it stinks.
  • remodeler, have you found an effective alternative to amazon for phyiscal? Im looking through CJ right now and it's just not as good it seems. I don't want to sale ebooks as they are just crap almost it seems. I want to sale quality products and amazon made that easy to find.
    • [1] reply
    • No I haven't. I've tested others like Target, Walmart, etc., and they were not even 10% of what I made with Amazon. Others I've talked with can attest to the same. That's one of the frustrating parts to this action.

      Going from state to state and setting up LLC's or any of the other ways you hear about on here is just a short term fix, and can be an expensive one at that in some cases. (Cover your backside with legal advice before making any decisions.) But how long before every state jumps on the cash wagon with these laws? Regardless of the true facts behind the curtain, these politiicians see this as an easy mark. And they've been frothing at the mouth for years to get a piece of the internet tax pie. Ultimately, it will play itself out in the US Supreme Court, but that is likely a few years away. In the meantime, we're left to figure out our own path.

      As far as Amazon, it's hard to say if terminating affiliates in these states is going to really affect their profits. They've built up such a trusted presence over the years, and some of it with our help, that it may not hurt them at all. I would venture to say that affiliates from unaffected states and countries will fill the void.

      Wish I had an easy solution. You do have a positive aspect with this in that you have some time to develop a plan. I wish you the best going forward!
  • lol great I find a business model that is working for me and now I got to stop! Looks like I might go back to the drawing boards. Perhaps an effective business model would be creating my own $7 reports?
  • Maybe the admins should open a "one in all thread" for "Enter your state here" is being dumped by Amazon.

    Amazon is fighting a good fight but slowly all these cash-hungry states will be following the other states. Plus Amazon's rivals are pushing back hard since they want to take that sales advantage from Amazon. Time to re-focus even more on eBay's ePN program. I used them first then added Amazon but since I'm in Cali looks like it's time.
  • Thanks remodeler. I think im going to give a shot at creating my own $7 info products. Might be hard since I got to write my own sales page and all. I want to make sure I offer a quality product though for 7 bucks.
  • Someone in Illinois told me that its Governor Quinn who is responsible for this in Illinois, so is it the politicians or Amazon themselves.....what exactly is the issue?

    I am not clear on the issue and I'm in Canada but am an affiliate for the U.S.

    Thanks,
    Terri
    • [1] reply
    • The issue is, the new law redefines Amazon's business presence in the state of Illinois. Before the law passed, merely having affliates promoting Amazon products in the state did not constitute a physical presence in Illinois, so Amazon was not required to collect sales tax on their sales there. After the new law passed, it's as if Amazon opened up a new branch of their business there, and now must collect sales tax for the state.

      Quinn is responsible for signing this into law in Illinois. Amazon is responsible for terminating its Illinois affliates, because they (Amazon) are unwilling to comply with this new tax collection burden.

      As more and more states follow suit, Amazon will either have to calculate and collect the various taxes for the various states, sue the states in court as they are doing in New York (and losing for the most part, unfortunately), or terminate their affiliates in the states that pass such laws.

      Unless where you live in Canada passes a similar law with a similar tax collection burden imposed on Amazon, I think you are safe from being terminated by Amazon for this reason. Being in California, I am probably not so fortunate, because it looks like California will be the next state to fall.

      Disclaimer: I am not a lawyer, and this is just my interpretation of what is going on. Anyone paying attention at all can see how greedy and irrational most politicians are, so if they can figure out a way around the US Constitution, rest assured that sooner or later they will.

      Cynical? Moi? LOL
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