IRS Reporting Regulations on Third-Party (3P) Payment Transactions

Due to Internal Revenue Service (IRS) regulations, U.S. third-party settlement organisations and payment processors, including Amazon, are required to file Form 1099-K for taxpayer sellers based in the U.S. who meet the following thresholds in a calendar year:

• More than $20,000 in unadjusted gross sales, and
• More than 200 transactions.

If you are not a U.S.-based seller or do not meet both of these thresholds, you will not receive a Form 1099-K.

IRS regulations require sellers based in the U.S. who are non-U.S. taxpayers to provide Form W-8BEN to Amazon in order to be exempt from U.S. tax reporting requirements.

Additionally, changes in state tax law require Amazon to report unadjusted gross sales of $600 or more to sellers with addresses in Massachusetts or Vermont. There are no transaction thresholds for state reporting.

Providing your taxpayer identification information to Amazon

Amazon requires that all sellers based in the U.S. complete the U.S. Tax Identity Information Interview.

You can provide your information to Amazon by clicking here to use our self-service interview process that will guide you through entering your taxpayer information and validating your W-9 or W-8BEN form. To fulfil the IRS requirements as efficiently as possible, answer all questions and enter all information requested during the interview.

Avoid misspellings or entering incorrect Tax Identification Numbers, both of which can result in an invalidated tax form. Move forward or backward through the Tax Interview process at your own pace. Do not worry if you are not sure which form (W-9 or W-8BEN) applies to you. The answers you provide during the Tax Interview will automatically determine that for you. To help protect the security of your taxpayer identification information, do not disclose it by email or over the phone.

For instructions on how to take the Tax Interview, click here.

Frequently Asked Questions

Tax interview

Can Amazon help me with my tax return or assist me in completing the tax interview?

Whilst we are committed to helping sellers understand the requirements under these tax regulations, we do not provide tax guidance. Please contact a tax professional.

Solutions Provider Network

I am a U.S. taxpayer. What information do I need to provide to Amazon?

By completing the Tax Interview in your seller account, you will be providing Amazon the appropriate tax identity in the form of a W-9 or W-8BEN form.

For U.S. taxpayers, a TIN is required by the IRS for the administration of tax laws. In most cases, your TIN is either an Employer Identification Number (EIN) or a Social Security Number (SSN).

I am a foreign seller and not a U.S. taxpayer. Do I need to provide any information to Amazon?

Yes. Even if you are a non-U.S. taxpayer, you still need to provide us with information and the responses you give to the tax interview wizard questions will create the appropriate tax form on your behalf.

IRS regulations require non-U.S. taxpayers to provide Amazon with the Form W-8BEN in order to be exempt from U.S. tax reporting requirements.

Additionally, Amazon must obtain identifying information, such as a tax ID, from certain sellers on Amazon’s non-US websites. In general, the IRS regulations require Amazon to collect identifying information from sellers who have a US address, US banking information or other identifying information connecting the seller to the US.

Will I be able to provide my VAT number during the tax interview?

No, the interview does not collect information about VAT. We will continue to collect your VAT information within the Account Info page on Seller Central.

How do I determine the beneficial owner for my Selling Account?

For information on beneficial ownership, please visit the IRS website.

Will Amazon provide me with a copy of my W-8BEN or W-9 Form?

Amazon does not provide paper copies of W-8BEN or W-9 Forms, but you will have an option to download an electronic copy of your forms at the end of the tax interview. Please retain a copy of all tax information you provide to Amazon.

I am not going to come even close to hitting the reporting threshold. Why does Amazon require my tax identity?

All sellers on Amazon.com, regardless of the number of transactions they have in a calendar year, are required to complete the Tax Information Interview.

I received an email stating that my Form W-8 is expiring or has already expired. How do I give Amazon new or updated information?

The U.S. Internal Revenue Service (IRS) requires that Amazon maintain a current Form W-8 for merchants, individuals or entities who are not U.S. persons. If you have received an email from Amazon stating that your Form W-8 is expiring or has expired, you must complete an updated Tax Interview to continue selling. To access the Tax Interview, see instructions here. If you are a non-U.S. person, failure to maintain a current Form W-8 will result in suspension of your selling privileges.

I received an error message when trying to complete the Tax Interview. What should I do?

The information provided during the Tax Interview needs to match the IRS records.

• If you are completing the U.S. Tax Identity Information Interview as an individual, use the information that appears on your Social Security card.
• Misspelling your name, not including your middle initial or middle name, or entering an incorrect Tax Identification Number may cause validation of your form to fail.
• If you are completing the information as a business, use the name that appears on the top line of the address on your CP575A notice from the IRS.

U.S. Person:

• Individual: Use the name that appears on your Social Security Card.
• Business: Use the same name and Taxpayer Identification Number that appears on your entity’s tax return.
• If you selected any type of federal tax classification other than "Individual/sole proprietor", use the following depending on the type of federal tax classification that you selected:
  • C Corporation: Refer to CP575 notice to confirm your federal tax classification type or contact the IRS.
  • S Corporation: Refer to CP575 notice to confirm your federal tax classification type or contact the IRS.
  • Partnership: Use the name as it appears in the partnership agreement.
  • Trust: Use the name as it appears on the trust deed.
  • Limited Liability Company: Refer to CP575 notice to confirm your federal tax classification type or contact the IRS.
  • Other:
    • If you are a non-profit under Internal Revenue Code sections 501(c) or 501(d), select ‘Other’ as your federal tax classification and then select the first option, ‘An organisation exempt from tax under section 501(a), any IRA or a custodial account under section 403(b)(7) if the account satisfies the requirements of section 401(f)(2)’ under the ‘Other type’ drop-down.
    • Refer to the code section that states under 501(a), ‘An organisation described in subsection (c) or (d) shall be exempt from taxation…’ Therefore, by saying that you are exempt under (a), you are saying that you are exempt under either (c) or (d).

Non-U.S. Person:

• Individual and Business: Use the name that appears on your income tax returns.

I received an email stating that my tax identity information is invalid. I thought I provided my correct information. Can you tell me why it came back invalid?

We do not know exactly why your tax identity information came back as invalid, but here are some things to consider:

• For an individual, this typically means entering the name and Social Security Number (SSN) as they appear on your Social Security card.
• For a business, this typically means entering your Employer Identification Number (EIN) and the name that appears on the notice you received with your EIN number.
• If you are a single-member LLC, you can enter the business owner's SSN and name. Another option is to enter the EIN and business name. Do not enter the disregarded entity's EIN.
• More detailed information for ensuring you have provided valid tax information can be found in the FAQ provided above.

If you provided tax identity information and it came back invalid, you have 30 days from the date of the email from Amazon to correct the tax identity information. If you do not provide corrected tax identity information within 30 days, your Amazon selling privileges will be suspended.

Tax status

I have provided my tax identity. How long will it take to see if it is valid?

After you update your tax identity information, the Legal Entity section of your Account Info page will display ‘Provided and Pending Validation’. If we find that your information does not match IRS records, we will send you an email with instructions on how to proceed. If you choose to post your hard copy document instead of consenting to electronic signatures, we will require 10-15 business days to process it upon receipt.

If we find that your information does not match IRS records, we will send you an email with instructions on how to proceed.

The validation process can take up to eight weeks from the time Amazon receives your information, either electronically or via mail, if you ticked the box that states ‘I have received my EIN/SSN within 60 Days’ while taking the tax interview.

If you choose to post a hard copy of your documents instead of consenting to electronic signatures, it can take 10-15 business days to process them once the form has been received.

Update tax information

How do I update my tax information and legal business name?

To update your tax information, you must complete the U.S. Tax Identity Information Interview.

To update your legal business name:

1. Go to Settings and click Account Info.
2. Under Business Information, click Business and Contact Information
3. Enter your Company’s Legal name

Tax form 1099-K

When will I receive my Form 1099-K?

Tax forms will be sent out by January 31. For accurate delivery, make sure that your contact information is updated no later than December 31. If you sign up for e-delivery, your tax forms will be emailed to you by January 31. To sign up for e-delivery, you must retake the Tax Interview and provide an e-signature at the end. For instructions on how to access the Tax Interview, click here.

Where do I find my Form 1099-K that Amazon issued for my seller account?

You can find the form in your seller account. From the Reports section, select Tax Document Library, then the appropriate year, and then Form 1099-K.

Are there instructions on how to use Form 1099-K for my tax return?

To find out how this legislation and Form 1099-K affect your business or if you have other questions, contact your tax, legal or other professional advisor.

For Individual filers, see these IRS instructions: http://www.irs.gov/pub/irs-pdf/i1040sc.pdf

For legal entity filers, see Form 1120: http://www.irs.gov/pub/irs-pdf/i1120.pdf

For more information on IRS Form 1099-K, see Form 1099-K.

How do I save a copy of the Form 1099-K to my computer?

From the Reports section in your seller account, select Tax Document Library, then the appropriate year, and then Form 1099-K. Click the Download PDF link. To save the form to your computer, while it is open in Adobe Reader, click File, then Save As, and then PDF. Select a location on your computer and click Save.

I believe there is an error on the Form 1099-K that I was issued. How do I get an updated Form 1099-K?

If the error is related to:

Incorrect address: To update your address, you must retake the Tax Interview. Make sure that you provide an e-signature at the end for faster processing. Instructions for completing the tax interview are provided here. Note that this will only update your address for tax purposes.

Incorrect tax ID or name: Your IRS Form 1099-K was issued based on the tax information on file at the time the payment was made. To make an update, you must retake the Tax Interview. Make sure that you provide an e-signature at the end for faster processing. Instructions for completing the tax interview are provided here.

Change of information: If you have provided Amazon with updated tax information during the calendar year, you will receive a separate 1099-K form for each tax ID that met the reporting thresholds for the calendar year.

Amount: If you are referencing your bank account or your settlement report from Amazon, note that per IRS regulations, the amounts listed on your IRS Form 1099-K represent the unadjusted gross sales that occurred and not the actual bank transfers. Unadjusted gross sales represent your total sales unadjusted for fees or refunds. The amount is the total that buyers paid for orders, even if orders were later refunded.

Will I receive a Form 1099-K for my account even though my unadjusted gross sales are below $20,000 and my transactions are below 200?

For each calendar year, if you had at least $20,000 in unadjusted gross sales and more than 200 transactions, a Form 1099-K will be provided to you. If you did not meet both of these thresholds, you will not receive a Form 1099-K. We will track your unadjusted gross sales and number of transactions. You will also be able to tell if you have exceeded the thresholds by monitoring your unadjusted gross sales and number of transactions in your account.

Additionally, recent changes in state tax law require Amazon to report unadjusted gross sales of $600 or more to sellers with addresses in Massachusetts or Vermont. There are no transaction thresholds for the state reporting.

I did not receive my Form 1099-K in the post. What address was it posted to?

The Form 1099-K was posted to the address you provided in the tax interview. You can also retrieve the form from your seller account. From the Reports section, select Tax Document Library, then the appropriate year, and then Form 1099-K. Click the Download PDF link.

If you would like to update your delivery preferences to ensure that you receive your forms via e-delivery, you must retake the Tax Interview and provide an e-signature at the end for faster processing. Instructions for completing the tax interview are provided here.

Are the reported amounts on my Form 1099-K in USD or local currency?

All non-US regions (EU, JP, etc.) have their Form 1099-K reported in USD. However, your Seller Central date range reports provide transactional amounts in local currency. For generating Form 1099-K, Amazon uses a daily exchange rate that is applied on the date the transaction is booked.

Is the $20,000 calculated based on net sales or gross sales?

The $20,000 is calculated based on unadjusted gross sales. Unadjusted gross sales means the total sales, unadjusted for fees or refunds. It is the amount the buyer paid for an order even if the order is later refunded.

Why are sales tax and delivery charges included in my unadjusted gross sales amount?

Unadjusted gross sales equals the amount the buyer paid for the order and includes sales proceeds, sales tax, and gift-wrap and shipping charges.

Does the gross sales amount not change if I refund an order?

No. When you make a sale, the order total becomes a permanent part of your unadjusted gross sales for the year. Even if you later refund the entire amount a buyer paid for an order, the order total is still included in your unadjusted gross sales calculation. The IRS regulations require that no adjustments to gross transaction amounts be made. Please seek advice from a tax professional to understand the appropriate adjustments when preparing your tax return.

Here is an example that includes a discount to the buyer, an Amazon fee and an eventual full refund to the buyer:

Item price: $100

Seller promotional discount: -$10 (subtracted before the gross sales amount is calculated)

Delivery charge: $15

Order total: $105 (gross sales amount)

Amazon fee: -$20 (subtracted after the gross sales amount is calculated)

The buyer is later refunded in full.

Buyer credit of the order total: -$105

Seller credit of the Amazon fee: $20

Net: $0

The gross sales amount for the purposes of calculating annual gross sales is $105, even after the refund.

If I have multiple seller accounts with the same tax identification number and they exceed the thresholds when the account totals are combined, will you file Form 1099-K for my combined seller accounts?

Yes. Unadjusted gross sales and transaction volumes will be consolidated for all accounts that have the same Tax Identification Number (TIN).

Understanding transactional details

How do I find the summary level details of my unadjusted gross sales for a specific year?

To generate a date range report, follow these steps:

1. From Reports, click Payments.
2. Select Date Range Reports. You will need to generate a report for both Standard and Invoiced orders.
3. Click Generate Report.
4. In the Generate date range report pop-up box, proceed as follows:
   
   1. Select report type: Summary
   2. Select reporting range: Month or Custom, and the specified date information
   3. Click Generate.
5. Review your report in the list on the Date Range Reports page.
   Note: Reports can take up to one hour to generate. If you cannot see your report in the list yet, check again later.
6. To calculate unadjusted gross sales, add the amounts in the report columns listed in the two charts below:

   Income

   The Income section includes your sales, credits and refunds.

   Line Item	Description
   Seller-fulfilled product sales	The total amount of your product sales for seller-fulfilled products.
   FBA product sales	The total amount of your product sales for Amazon-fulfilled products.
   Delivery credits	The amount paid by buyers for delivery.
   Gift wrap credits	The amount paid by buyers for gift wrap.
   Promotional rebates	The amount deducted from your account balance for promotional offerings.

   Sales Taxes

   The Sales Taxes section includes the taxes collected on product sales and services.

   Line Item	Description
   Sales, shipping, and gift wrap tax	Sales tax collected from buyers for product sales, delivery and gift wrap. This amount may include deductions for promotional rebates.

How do I find the transactional level details of my unadjusted gross sales for a specific year?

You can use the Date Range Reports page to generate individual transaction reports for a specific date range.

To generate a date range report, follow these steps:

1. From Reports, select Payments.
2. Select Date Range Reports. You will need to generate a report for both Standard and Invoiced orders.
3. Click Generate Report.
4. In the Generate date range report pop-up box, proceed as follows:
   
   1. Select report type: Transaction
   2. Select reporting range: Month or Custom, and the specified date information
   3. Click Generate.
5. Review your report in the list on the Date Range Reports page.
6. Filter the type column by Order.
7. To calculate unadjusted gross sales, add the amounts in these columns for both Standard and Invoiced orders:
   • Product sales
   • Product sales tax
   • Delivery credits
   • Delivery credits tax
   • Gift wrap credits
   • Gift wrap credits tax
   • Promotional rebates
   • Promotional rebates tax

Transactions from both of these reports are included in the unadjusted gross sales, which then leads to the IRS Form 1099-K form.

The transactional level details in my date range reports do not match the IRS Form 1099-K that I received.

The IRS Form 1099-K you received is reported based on the information you provided during the US tax identity interview. The IRS Form 1099-K is generated from your Selling on Amazon activity, Amazon Pay, Mechanical Turk (MTurk) and Flexible Payments Systems (FPS), plus Invoicing.