Questions for banned-state Amazon affiliates who have set up Corp./LLC in another state?

3 replies
My Amazon.com affiliate account is now closed due to the recent Nexus law passed in Missouri. I am trying to decide if it would be worth it to create an LLC in another state, so I can be an Amazon affiliate again, or just move on to other things.

I am looking at Wyoming; since they have no Sales Tax on certain goods, hopefully they won't be passing a Nexus law in the near future.

I have found a range of services in Wyoming that do Corp./LLC setup, from very basic service with Setup + providing a Registered Agent, to a complete setup with everything including mail forwarding and bank account setup. Of course, the prices rise accordingly, the more services they provide. For a basic setup + reg. agent, price is usually about $130-$200. For "the works", from $520 to $899.

I am having some difficulty locating any agency/person who will act as a Registered Agent only. It is always part of a package deal, large or small.

I would like to hear from other Amazon affiliates who have set up their Corp./LLC in another state, and find out what their experience was like, what pitfalls were encountered, etc. I have the following questions, but feel free to chime in with any other relevant details I might not have thought about.

  1. Did you set up your new Corporation (or LLC) yourself, or did you hire an agency to do all or part of the work? If you did use an agency for all/part, were they satisfactory?
  2. Is there anything that you would do differently the next time?
  3. Did you acquire a bank account in the new state or use a bank in the state where you live? Was if difficult to open a bank acct. in the new state? What was required?
  4. After setting up in the new state, how did you handle it with Amazon? Did you just go into your account and change your address to your new corp. address, or did you apply for a brand new affiliate account?
  5. Did Amazon request any corroborating evidence of your residence, such as Driver's License, utility bill, bank statement, etc.?
Question #5 is the part that has me a little worried. I read on another forum recently where the poster stated that he had created a corp. in another state and thought he was good to go. Then Amazon requested he show proof of his residency with utility bills, etc. Since he could not provide the requested documents, he was pretty much up the proverbial creek. I really don't want to spend several hundred dollars getting this done, and have it end up being for nothing.


Any experiences and insight you can share would be greatly appreciated.
#affiliates #amazon #bannedstate #corp or llc #questions #set #state
  • Profile picture of the author ratracegrad
    When my state passed the law I used legalzoom.com to create my company in Delaware. For a fee they will act as your registered agent. If you have already registered your company then you can still use legalzoom as your registered agent for a fee.
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    • Profile picture of the author dba2020com
      Sorry, I can not answer your questions. I can only add my own.

      How does this law affect being an affiliate for any company? Walmart has a nexus in my state (Arkansas) but can I be their affiliate?

      In reading the Arkansas version of the law, it stated a base of making more than $10,000. I have no idea if that is total or per affiliation. I have yet to consult with an attorney.

      My thoughts governing my actions are:

      1 - Deal with the issue when I reach the base amount and be the tax collector by offering up portions of the proceeds - 10% to the state, 40% to the Feds, leaving 50% for my company.
      2 - Contact my Federal representatives and get them to pass the Federal version.
      3 - Contact my State representatives to accept the federal version and rescind the state's version of the law.
      4 - Actually making money would establish the viability of having an Internet business.
      5 - Not being an affiliate at all but sell my own product. At least, it would justify having to levy a tax to my customers.

      Sorry, I only added more questions. It just seems to me to be a bigger thing than incorporating and attempting to "get around" the law. In my reading, I read that the current laws on the states' book were probably unconstitutional anyway.

      I am typically not an activist. But, This might be a cause worth fighting for. It's unfortunate that the battle must be fought in the 5 or more states affected and hard to find all the people affected by the state's laws. Any hope of making it Fair would have to come at a Federal level.

      My input for what it is worth.
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      • Profile picture of the author sprucehill
        Originally Posted by dba2020com View Post

        How does this law affect being an affiliate for any company? Walmart has a nexus in my state (Arkansas) but can I be their affiliate?
        You have raised some interesting points, for which I have no definitive answers.

        However, I can answer the question about WalMart. I believe they have "nexus" in nearly all states. They simply charge the sales tax for orders made at walmart.com, whether the orders are through affiliates or not. Amazon is not willing to go to the trouble of charging sales tax, and that is the reason they have dropped affiliates in all the states with the nexus laws.

        And yes, you can be an affiliate for WalMart. I am a WalMart affiliate through Linkshare. I have already changed my Amazon links on one site to WalMart, and some of the links on another to WalMart, and some to another retailer. Will see how it goes. However, I can tell you that WalMart only pays a very small commission - 4%. It is usually the same for any store that has a large retail presence, their commissions are generally only 1-4%.

        I have joined Commission Junction and am looking at their vendors to see which ones might match up well with my sites. Whether or not there will be a problem with any other vendors because of the nexus law, I don't know, but I guess I will find out when I start applying.

        I have decided not to go with an LLC in another state for the present, although I may do so at a later date.
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