Fellow Californians: Amazon Pull-out

13 years ago

Amazon had no choice for the course they were forced to take. What all the nexus state legislatures have done is unconstitutional, which would have left Amazon with huge and devastating back-tax liabilities. Amazon had to adapt, and the affiliates who have also adapted in these states by incorporating are reaping the rewards as well. It is not just California being affected.

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redstanford

13 years ago

i thought about incorporating into another state like Washington or Wyoming but everything about it screams illegal or tax fraud to me

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rob1123 13 years ago

Wouldn't it be better to use the ebay partners network, people may be more trustful, and you get commission from anything they buy.
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derp.
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Rick Wilson 13 years ago

Originally Posted by redstanford

i thought about incorporating into another state like Washington or Wyoming but everything about it screams illegal or tax fraud to me

To incorporate "properly" in another state (especially for affiliate nexus reasons), you will need a good attorney and cpa to cover all the bases or you might end up with even more liability. Each state has their own different nexus requirements. Lot of gray areas still.

As for illegal/tax fraud ... IF done properly it's a non issue.

As my attorney likes to say, "There's a big difference between tax evasion and tax avoidance - tax evasion IS illegal while tax avoidance IS legal. At least here in the U.S. anyway.

Note: Just so you know, I'm from RI (one of those states that passed their own nexus bill) and Amazon dropped me too. It sux but Amazon made a business decision. I would have done the same thing in their shoes. Plenty more out there to go after!

Good Luck!

Rick Wilson aka CorpRebel
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- redstanford 13 years ago
  
  yea getting an attorney and all that is just not worth it at this point for someone like myself who still hasn't made more than I've spent on IM
  
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kindsvater

13 years ago

Originally Posted by redstanford

i thought about incorporating into another state like Washington or Wyoming but everything about it screams illegal or tax fraud to me

There is nothing illegal or fraudulent about it. Certainly not tax evasion.

Consider this: many major corps are incorporated in a state other than their home office state.

You still pay your taxes. All you are essentially doing is creating an alternative address for your Amazon account.

.

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seasoned

13 years ago

Originally Posted by kindsvater

There is nothing illegal or fraudulent about it. Certainly not tax evasion.

Consider this: many major corps are incorporated in a state other than their home office state.

You still pay your taxes. All you are essentially doing is creating an alternative address for your Amazon account.

.

If you do business in CA, and collect sales tax, California at least TENDS to not recognize your corporation unless you register THERE as a foreign corporation! In fact, since they will NOT recognize you, and thus REFUSE to issue a sales use permit, it is ILLEGAL for you to collect CA sales tax and you are REQUIRED to collect the tax if you sell at a price higher than that you paid tax on! HOW do they rectify that paradox? EASY! You are NOT allowed to sell in California at a price over that you paid tax on! BTW they have told ME this, and in a separate case told a friend that, and I was on the phone for HOURS discussing it! My friend ended up registering as a foreign corp!

That leads to a question? Do they consider your acting as a sales person to amazon to mean that you represent a presence in that state? They MUST, since that is the theory they use to charge the tax, and why amazon is cancelling those arrangements! Since they do, does that mean that the foreign corporation registration causes such a link? AGAIN, they ACT like that is the case.

Of course, this can be avoided by simply not collecting sales tax, but they say that your being paid means you must, so it seems like the chicken and the egg.

I think whether you think I am wrong or right, and whether they have determined this or not, they probably WILL do this. at least in california, where they DO have the local registration requirement.

Steve

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robdedgar

13 years ago

Maybe try switching your links to ebay affiliate links.

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Cool Hand Luke

13 years ago

It cost me about $500 to incorporate in NV, and I never had to leave San Diego.... there are legit ways around CA's new laws if you actually care to keep your Amazon biz intact.

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redstanford

13 years ago

Originally Posted by Cool Hand Luke

It cost me about $500 to incorporate in NV, and I never had to leave San Diego.... there are legit ways around CA's new laws if you actually care to keep your Amazon biz intact.

what about things like filing taxes? won't that draw the IRS's attention?

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Rick Wilson

13 years ago

Originally Posted by Cool Hand Luke

It cost me about $500 to incorporate in NV, and I never had to leave San Diego.... there are legit ways around CA's new laws if you actually care to keep your Amazon biz intact.

It's relatively easy and inexpensive to just set up a Corp/LLC, BUT if it wasn't set up in just the right way for your "company" you can possibly still have nexus issues. The states are clawing with every resource they have.

Not saying your corp isn't setup right for YOUR needs, just saying that others thinking the same thing should be aware that circumstances are different for each entity.

Here's a GREAT site/blog for info about these nexus tax issues (I have NO relationship with this site):

Nexus Negotiator

Two of the posts to pay particular attention to:

Nexus: How Do States Find You? | Nexus Negotiator

Nexus: How Do States Force You to Pay? | Nexus Negotiator

There's still ALOT of <hit to think about!

Hope it all works out for ya!

Rick Wilson aka CorpRebel

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crystalq

13 years ago

You can try Skim Links or Viglinks, theres a big post about it here
http://www.warriorforum.com/main-int...links-com.html

Most of the people who I know who use skim links, use it with PhpBayZon for amazon and Phpbay for ebay. They seem to be happy with it.

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emory27

13 years ago

Originally Posted by crystalq

You can try Skim Links or Viglinks, theres a big post about it here
http://www.warriorforum.com/main-int...links-com.html

Most of the people who I know who use skim links, use it with PhpBayZon for amazon and Phpbay for ebay. They seem to be happy with it.

i use skimlinks for ebay with numerous clients of mine and its been a great program

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seasoned

13 years ago

Originally Posted by redstanford

before May-June this past year, I kind of ignored the struggles affiliates in other states like Colorado where Amazon killed it's associates program in. I figured it shouldn't affect people that much.

well anyways, now that i've had no choice but to switch all my affiliate links from Amazon to programs through Commission Junction, I'm realizing just how big of a pain in the butt this has become.

Sales have all but completely stopped - whereas with Amazon I was making fairly decent sales on a regalar basis - I've made 1 in almost 2 months with Commission Junction programs. people just don't trust other companies like Amazon.

I read this board with members from other states that haven't been affected yet about Amazon with a bit of envy. I'm jealous of them. It was so easy with Amazon now I've had to almost re-invent the wheel with CJ, and I still don't have it figured out.

now believe me I don't not love Amazon. in fact, i think what they've done to Californians, Coloradoans and other state's associates was apunk move and I am angered they handled it like they did.

but truth be told, Amazon sells itself. CJ so far has not

So WHAT did you want them to do? Break the law and endanger the entire company? Hire a number of people and try to support potentially THOUSANDS of tax rates and somehow make arrangments with all their vendors, and charge the purchasers sales tax? And VENDORS may pull out!

REALLY, I once tried to do it in california, and didn't like dealing with I think it was 6 rates, when I was doing business there about 15 years ago. It is probably WORSE now, but if they did it in california, they would be asked to do it elsewhere.

Really, it is NOT as simple as you think. and this MAY affect sales!

Steve

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seasoned

13 years ago

One more thing! If Amazon has to do it, WHY do they have to do it? The law says that the law can ******NOT***** apply to THEM unless it applies to the others! That means IBM, XEROX, PRENTICE HALL, APPLE, and ********YOU********! Do you realize what that means? Are YOU setup to handle ALL the taxes in the US? I think it is far to say that perhaps NOBODY on this board is!

So will they want to have affiliates? AND, if AFFILIATES mean taxes, what about GOOGLE?

Do you see where I am going here?

BTW I didn't mention i earlier, but I have a NORMAL merchant account with one of the largest processors around. They sent me out a notice that, starting next year, they will report ALL payments made into my account,to the IRS!!!!!! GEE, I wonder where THAT is going!

Steve

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debra 13 years ago

I think I smell a Tea Party brewing in the near future.
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- MrRSmith 13 years ago
  
  I'm not sure what happened with Amazon. I just recently started with it myself and am from NM. What legislation are you folks referring to?
  
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Kurt

13 years ago

Originally Posted by redstanford

before May-June this past year, I kind of ignored the struggles affiliates in other states like Colorado where Amazon killed it's associates program in. I figured it shouldn't affect people that much.

well anyways, now that i've had no choice but to switch all my affiliate links from Amazon to programs through Commission Junction, I'm realizing just how big of a pain in the butt this has become.

Sales have all but completely stopped - whereas with Amazon I was making fairly decent sales on a regalar basis - I've made 1 in almost 2 months with Commission Junction programs. people just don't trust other companies like Amazon.

I read this board with members from other states that haven't been affected yet about Amazon with a bit of envy. I'm jealous of them. It was so easy with Amazon now I've had to almost re-invent the wheel with CJ, and I still don't have it figured out.

now believe me I don't not love Amazon. in fact, i think what they've done to Californians, Coloradoans and other state's associates was apunk move and I am angered they handled it like they did.

but truth be told, Amazon sells itself. CJ so far has not

I've never done well with CJ myself over the years. I wish I could give you some better advice, but my only advice is not to use CJ. I'm sure others have had some success, hopefully they'll share.

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Fellow Californians: Amazon Pull-out

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