California is trying to shake us down for uncollected sales taxes since 2012
So we are a small husband and wife operated retailer out of our home. We have been shipping items to FBA since the beginning of 2011. We got the letter from California and registered with them starting 1-1-2019 since we had physical Nexus in the state of California. Now they want us to figure out exactly when that Nexus started which Amazon will not tell us, we assumed it is the day their first fulfillment center opened in Cali in 2012. Basically they want us to contact each customer and try to collect taxes since then, if not we are suppose to pay it to California. The whole situation is messed up. We can’t even attempt to contact all those customers plus I think that would go against the rules of Amazon and confidentiality, even then we we can’t pay California for any disclosed amount. I mean there is no way to access each sales order to get the contact info on the buyers from 2102/13/14 and so on. It would just bankrupt us, being that it would be well over $100k. They are threatening us with a potential audit. We are just so bummed about this, our accountants don’t even know what to do. Just thought I would let you other sellers know. We are not that big, and we don’t have the means to lawyer up so I guess we will just wait until California takes action against us…
318 replies
Seller_cCzOKNQAUJTHn
Sorry to hear about this.
You may want to seek the guidance of another accountant like a second opinion just to see some options.
Often a consultation like this is free before they do any real work.
Seller_mWZyJunCxCR84
If 100K is in question, you should maybe talk to a lawyer that specializes in Taxes and get their opinion. They may have been spending time looking for loopholes in California’s law.
Seller_jqXQahnyQrUnf
This is the exact thing Funky has warned everyone about. If you did not register with them, this would not be happening to you.
Seller_6i4I7oUGDRFBe
When you say $100,000 do you mean $100,000 in sales or you owe that much in taxes? If they’re saying you owe that much in taxes then I wouldn’t consider you a small retailer. Do you use any type of software that you have all your Amazon orders go into? I can easily weed out all orders to a specific state using Quickbooks and go all the way back to when we started using the program.
I was able to go all the way back to our open date 2014 within Amazon under statements so you will be able to do that to see your orders but you will probably have to look at every individual sale to see if it was CA or not.
Seller_Yvu9QfhV55nVu
This is from https://www.cdtfa.ca.gov/taxes-and-fees/use-tax.htm#qualified_purchaser
Overview
California’s sales tax generally applies to the sale of merchandise, including vehicles, in the state. California’s use tax applies to the use, storage, or other consumption of those same kinds of items in the state.
Generally, if sales tax would apply when you buy physical merchandise in California, use tax applies when you make a similar purchase without tax from a business located outside the state.
For these purchases, the buyer is required to pay use tax separately.
If you made purchases for a business use and may owe tax, click on the For Business Use tab for more information and payment options.
If you made purchases for your personal use and may owe tax, click on the For Personal Use tab for more information and payment options. Watch this video for more information about use tax:
So, isn’t the buyer the one who has to pay to the state of Caliornia ?
Seller_t2oX2ioxk2EDk
What a total mess this is for us. So California has no idea how much we owe other than the fact that they know we have had inventory in fulfillment centers since day one.
Here is the real issue: According to the laws we have physical nexus in numerous states due to FBA. So we are “damned if we do and damned if we don’t” If we try to be good people and sellers and register business licenses with all states (like we did with CA) that we have physical or economic nexus in, then technically they will do what Cali is doing, which is going after all the uncollected sales tax since our beginning 8 years ago. I’m guessing that would be over 500k owed for all states if they wanted to go after us. I don’t see how this is going to end well for any of us that have a significant business on Amazon. If we have just a few more cases like California going after us for past taxes we will get bankrupted. This is just so sad on all parts. We have worked so hard growing our little business starting with just $200 back in 2009 on Ebay, we do about 1.2 to 1.4 million in annual gross sales these days and clear about 192k a year in salaries for both my wife and I. This is just a job that we love but we see doom in the future as Jeff Bezos and Amazon just don’t care about us 3rd party sellers, and left us dead with not intervening on this tax issue.
Seller_jZWpyInw8RkYT
@FunkyMonkey, any suggestions for OP?
Or any data for @Calamine_Potion?
Seller_y0sAQvJ2Bhlw7
Have you verified the letter is true and genuine and not a scam?
Seller_iAs87otbyI3YE
Good for you…please report back how they put you thru the wringer and back.
You can be the poster child of signing up for CA that has no legal jurisdiction over you.
Maybe you should all read funkys posts more…
California is trying to shake us down for uncollected sales taxes since 2012
So we are a small husband and wife operated retailer out of our home. We have been shipping items to FBA since the beginning of 2011. We got the letter from California and registered with them starting 1-1-2019 since we had physical Nexus in the state of California. Now they want us to figure out exactly when that Nexus started which Amazon will not tell us, we assumed it is the day their first fulfillment center opened in Cali in 2012. Basically they want us to contact each customer and try to collect taxes since then, if not we are suppose to pay it to California. The whole situation is messed up. We can’t even attempt to contact all those customers plus I think that would go against the rules of Amazon and confidentiality, even then we we can’t pay California for any disclosed amount. I mean there is no way to access each sales order to get the contact info on the buyers from 2102/13/14 and so on. It would just bankrupt us, being that it would be well over $100k. They are threatening us with a potential audit. We are just so bummed about this, our accountants don’t even know what to do. Just thought I would let you other sellers know. We are not that big, and we don’t have the means to lawyer up so I guess we will just wait until California takes action against us…
California is trying to shake us down for uncollected sales taxes since 2012
So we are a small husband and wife operated retailer out of our home. We have been shipping items to FBA since the beginning of 2011. We got the letter from California and registered with them starting 1-1-2019 since we had physical Nexus in the state of California. Now they want us to figure out exactly when that Nexus started which Amazon will not tell us, we assumed it is the day their first fulfillment center opened in Cali in 2012. Basically they want us to contact each customer and try to collect taxes since then, if not we are suppose to pay it to California. The whole situation is messed up. We can’t even attempt to contact all those customers plus I think that would go against the rules of Amazon and confidentiality, even then we we can’t pay California for any disclosed amount. I mean there is no way to access each sales order to get the contact info on the buyers from 2102/13/14 and so on. It would just bankrupt us, being that it would be well over $100k. They are threatening us with a potential audit. We are just so bummed about this, our accountants don’t even know what to do. Just thought I would let you other sellers know. We are not that big, and we don’t have the means to lawyer up so I guess we will just wait until California takes action against us…
318 replies
318 replies
Seller_cCzOKNQAUJTHn
Sorry to hear about this.
You may want to seek the guidance of another accountant like a second opinion just to see some options.
Often a consultation like this is free before they do any real work.
Seller_mWZyJunCxCR84
If 100K is in question, you should maybe talk to a lawyer that specializes in Taxes and get their opinion. They may have been spending time looking for loopholes in California’s law.
Seller_jqXQahnyQrUnf
This is the exact thing Funky has warned everyone about. If you did not register with them, this would not be happening to you.
Seller_6i4I7oUGDRFBe
When you say $100,000 do you mean $100,000 in sales or you owe that much in taxes? If they’re saying you owe that much in taxes then I wouldn’t consider you a small retailer. Do you use any type of software that you have all your Amazon orders go into? I can easily weed out all orders to a specific state using Quickbooks and go all the way back to when we started using the program.
I was able to go all the way back to our open date 2014 within Amazon under statements so you will be able to do that to see your orders but you will probably have to look at every individual sale to see if it was CA or not.
Seller_Yvu9QfhV55nVu
This is from https://www.cdtfa.ca.gov/taxes-and-fees/use-tax.htm#qualified_purchaser
Overview
California’s sales tax generally applies to the sale of merchandise, including vehicles, in the state. California’s use tax applies to the use, storage, or other consumption of those same kinds of items in the state.
Generally, if sales tax would apply when you buy physical merchandise in California, use tax applies when you make a similar purchase without tax from a business located outside the state.
For these purchases, the buyer is required to pay use tax separately.
If you made purchases for a business use and may owe tax, click on the For Business Use tab for more information and payment options.
If you made purchases for your personal use and may owe tax, click on the For Personal Use tab for more information and payment options. Watch this video for more information about use tax:
So, isn’t the buyer the one who has to pay to the state of Caliornia ?
Seller_t2oX2ioxk2EDk
What a total mess this is for us. So California has no idea how much we owe other than the fact that they know we have had inventory in fulfillment centers since day one.
Here is the real issue: According to the laws we have physical nexus in numerous states due to FBA. So we are “damned if we do and damned if we don’t” If we try to be good people and sellers and register business licenses with all states (like we did with CA) that we have physical or economic nexus in, then technically they will do what Cali is doing, which is going after all the uncollected sales tax since our beginning 8 years ago. I’m guessing that would be over 500k owed for all states if they wanted to go after us. I don’t see how this is going to end well for any of us that have a significant business on Amazon. If we have just a few more cases like California going after us for past taxes we will get bankrupted. This is just so sad on all parts. We have worked so hard growing our little business starting with just $200 back in 2009 on Ebay, we do about 1.2 to 1.4 million in annual gross sales these days and clear about 192k a year in salaries for both my wife and I. This is just a job that we love but we see doom in the future as Jeff Bezos and Amazon just don’t care about us 3rd party sellers, and left us dead with not intervening on this tax issue.
Seller_jZWpyInw8RkYT
@FunkyMonkey, any suggestions for OP?
Or any data for @Calamine_Potion?
Seller_y0sAQvJ2Bhlw7
Have you verified the letter is true and genuine and not a scam?
Seller_iAs87otbyI3YE
Good for you…please report back how they put you thru the wringer and back.
You can be the poster child of signing up for CA that has no legal jurisdiction over you.
Maybe you should all read funkys posts more…
Seller_cCzOKNQAUJTHn
Sorry to hear about this.
You may want to seek the guidance of another accountant like a second opinion just to see some options.
Often a consultation like this is free before they do any real work.
Seller_cCzOKNQAUJTHn
Sorry to hear about this.
You may want to seek the guidance of another accountant like a second opinion just to see some options.
Often a consultation like this is free before they do any real work.
Seller_mWZyJunCxCR84
If 100K is in question, you should maybe talk to a lawyer that specializes in Taxes and get their opinion. They may have been spending time looking for loopholes in California’s law.
Seller_mWZyJunCxCR84
If 100K is in question, you should maybe talk to a lawyer that specializes in Taxes and get their opinion. They may have been spending time looking for loopholes in California’s law.
Seller_jqXQahnyQrUnf
This is the exact thing Funky has warned everyone about. If you did not register with them, this would not be happening to you.
Seller_jqXQahnyQrUnf
This is the exact thing Funky has warned everyone about. If you did not register with them, this would not be happening to you.
Seller_6i4I7oUGDRFBe
When you say $100,000 do you mean $100,000 in sales or you owe that much in taxes? If they’re saying you owe that much in taxes then I wouldn’t consider you a small retailer. Do you use any type of software that you have all your Amazon orders go into? I can easily weed out all orders to a specific state using Quickbooks and go all the way back to when we started using the program.
I was able to go all the way back to our open date 2014 within Amazon under statements so you will be able to do that to see your orders but you will probably have to look at every individual sale to see if it was CA or not.
Seller_6i4I7oUGDRFBe
When you say $100,000 do you mean $100,000 in sales or you owe that much in taxes? If they’re saying you owe that much in taxes then I wouldn’t consider you a small retailer. Do you use any type of software that you have all your Amazon orders go into? I can easily weed out all orders to a specific state using Quickbooks and go all the way back to when we started using the program.
I was able to go all the way back to our open date 2014 within Amazon under statements so you will be able to do that to see your orders but you will probably have to look at every individual sale to see if it was CA or not.
Seller_Yvu9QfhV55nVu
This is from https://www.cdtfa.ca.gov/taxes-and-fees/use-tax.htm#qualified_purchaser
Overview
California’s sales tax generally applies to the sale of merchandise, including vehicles, in the state. California’s use tax applies to the use, storage, or other consumption of those same kinds of items in the state.
Generally, if sales tax would apply when you buy physical merchandise in California, use tax applies when you make a similar purchase without tax from a business located outside the state.
For these purchases, the buyer is required to pay use tax separately.
If you made purchases for a business use and may owe tax, click on the For Business Use tab for more information and payment options.
If you made purchases for your personal use and may owe tax, click on the For Personal Use tab for more information and payment options. Watch this video for more information about use tax:
So, isn’t the buyer the one who has to pay to the state of Caliornia ?
Seller_Yvu9QfhV55nVu
This is from https://www.cdtfa.ca.gov/taxes-and-fees/use-tax.htm#qualified_purchaser
Overview
California’s sales tax generally applies to the sale of merchandise, including vehicles, in the state. California’s use tax applies to the use, storage, or other consumption of those same kinds of items in the state.
Generally, if sales tax would apply when you buy physical merchandise in California, use tax applies when you make a similar purchase without tax from a business located outside the state.
For these purchases, the buyer is required to pay use tax separately.
If you made purchases for a business use and may owe tax, click on the For Business Use tab for more information and payment options.
If you made purchases for your personal use and may owe tax, click on the For Personal Use tab for more information and payment options. Watch this video for more information about use tax:
So, isn’t the buyer the one who has to pay to the state of Caliornia ?
Seller_t2oX2ioxk2EDk
What a total mess this is for us. So California has no idea how much we owe other than the fact that they know we have had inventory in fulfillment centers since day one.
Here is the real issue: According to the laws we have physical nexus in numerous states due to FBA. So we are “damned if we do and damned if we don’t” If we try to be good people and sellers and register business licenses with all states (like we did with CA) that we have physical or economic nexus in, then technically they will do what Cali is doing, which is going after all the uncollected sales tax since our beginning 8 years ago. I’m guessing that would be over 500k owed for all states if they wanted to go after us. I don’t see how this is going to end well for any of us that have a significant business on Amazon. If we have just a few more cases like California going after us for past taxes we will get bankrupted. This is just so sad on all parts. We have worked so hard growing our little business starting with just $200 back in 2009 on Ebay, we do about 1.2 to 1.4 million in annual gross sales these days and clear about 192k a year in salaries for both my wife and I. This is just a job that we love but we see doom in the future as Jeff Bezos and Amazon just don’t care about us 3rd party sellers, and left us dead with not intervening on this tax issue.
Seller_t2oX2ioxk2EDk
What a total mess this is for us. So California has no idea how much we owe other than the fact that they know we have had inventory in fulfillment centers since day one.
Here is the real issue: According to the laws we have physical nexus in numerous states due to FBA. So we are “damned if we do and damned if we don’t” If we try to be good people and sellers and register business licenses with all states (like we did with CA) that we have physical or economic nexus in, then technically they will do what Cali is doing, which is going after all the uncollected sales tax since our beginning 8 years ago. I’m guessing that would be over 500k owed for all states if they wanted to go after us. I don’t see how this is going to end well for any of us that have a significant business on Amazon. If we have just a few more cases like California going after us for past taxes we will get bankrupted. This is just so sad on all parts. We have worked so hard growing our little business starting with just $200 back in 2009 on Ebay, we do about 1.2 to 1.4 million in annual gross sales these days and clear about 192k a year in salaries for both my wife and I. This is just a job that we love but we see doom in the future as Jeff Bezos and Amazon just don’t care about us 3rd party sellers, and left us dead with not intervening on this tax issue.
Seller_jZWpyInw8RkYT
@FunkyMonkey, any suggestions for OP?
Or any data for @Calamine_Potion?
Seller_jZWpyInw8RkYT
@FunkyMonkey, any suggestions for OP?
Or any data for @Calamine_Potion?
Seller_y0sAQvJ2Bhlw7
Have you verified the letter is true and genuine and not a scam?
Seller_y0sAQvJ2Bhlw7
Have you verified the letter is true and genuine and not a scam?
Seller_iAs87otbyI3YE
Good for you…please report back how they put you thru the wringer and back.
You can be the poster child of signing up for CA that has no legal jurisdiction over you.
Maybe you should all read funkys posts more…
Seller_iAs87otbyI3YE
Good for you…please report back how they put you thru the wringer and back.
You can be the poster child of signing up for CA that has no legal jurisdiction over you.
Maybe you should all read funkys posts more…
