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This article applies to selling in: Canada

IRS reporting regulations on third-party (3P) payment transactions

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

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

If you do not meet both of these thresholds, you will not receive a Form 1099-K.

IRS regulations require 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

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. Don't worry if you're 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, please do not disclose it by email or over the phone.

Help is available throughout the tax interview process, including links to IRS publications that support the IRS forms W-9 and W-8BEN.

See answers to frequently asked questions below, and learn more at the IRS website.

Important: Information in this document does not constitute tax, legal, or other professional advice and must not be used as such. If you have other questions, please contact your tax, legal, or other professional adviser.

Frequently asked questions

Regulations

Where can I learn more about the 1099-K and the 6050w regulations?

The regulations are under section 6050W of the Internal Revenue Code. Please see the IRS website for more information.

Do these regulations apply to non-profit organizations?

Yes, these regulations apply to both non-profit and for-profit organizations and entities.

What happens if I don't provide the required information?

If you do not provide valid tax identity information, your account will be considered in violation of our Amazon selling policies and your account will be suspended.

Tax identity collection & validation

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

While 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 with 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).

Learn how to obtain an EIN at the IRS website

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-US 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 Form W-8BEN to Amazon 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-U.S. websites. In general, the IRS regulations require us to collect identifying information from sellers who have a U.S. address, U.S. banking information, or other identifying information connecting the seller to the U.S.

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.

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, 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've provided my tax identity. How long will it take to see if it is valid?

After you update your tax identity information, the Legal Name section of your Account Info page will display "Provided and Pending Validation." If we find your information doesn't match IRS records, we will send you an email with instructions on how to proceed.

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.
  • 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.
  • Misspelling your name, not including your middle initial or middle name, or entering an incorrect Tax Identification Number (TIN) may cause validation of your form to fail.

    U.S. person:

    • Individual: Use the name that appears on your Social Security card.
    • Business: Use the same name and Taxpayer Identification Number (TIN) 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 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 (LLC): 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 organization 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” in the drop-down.
        • Please refer to the code section that states under 501(a), "An organization described in subsection (c) or (d) shall be exempt from taxation…” Therefore, by saying 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 don't 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.

Reporting and document retrieval

Will I receive a Form 1099-K for my account?

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.

When can I expect it?

Amazon will make available to you a copy of your form on or before 31 January of the following year. If you did not consent to electronic delivery, the form will be postmarked on or before 31 January of the following year and will be mailed to the address provided by you in the tax interview.

For more information on the Form 1099 filing instructions, please visit the IRS website: http://www.irs.gov/pub/irs-pdf/i1099gi.pdf.

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 the 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

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 and enter the password. 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 did not receive my Form 1099-K in the mail. What address was it mailed to?

The Form 1099-K was mailed 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, enter the password, save the form to your computer, and print a copy of it.

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 transaction 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 shipping 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.

Doesn't the gross sales amount 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 USD: $100

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

Shipping charge USD: $15

Order total USD: $105 (gross sales amount)

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

The buyer is later refunded in full.

Buyer credit of the order total USD: -$105

Seller credit of the Amazon fee USD: $20

Net USD: $0

The gross sales amount for the purposes of calculating annual gross sales is USD $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).

Can Amazon help me with my tax return?

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

Are there instructions on how to use the 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, please 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

Can Amazon help me with my tax return?

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

Solutions provider network

I believe there is an error on the Form 1099-K 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. Be sure to 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. Be sure to 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 buyers paid for orders, even if orders were later refunded.

Note: Amazon will not issue an updated Form 1099-K for previous years. It is the seller's responsibility to have updated information on file in all of their selling accounts.

1099-K form reconciliation

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

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

Note: Monthly reports cannot be generated for dates prior to January 2012. Custom date ranges cannot be generated for dates prior to 1 January 2012.

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 do not 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.
    Shipping credits The amount paid by buyers for shipping.
    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 The sales tax collected from buyers for product sales, shipping, and gift wrap. This amount may include deductions for promotional rebates.

How do I find the transaction 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
    • Shipping credits
    • Shipping credits tax
    • Gift wrap credits
    • Gift wrap credits tax
    • Promotional rebates
    • Promotional rebates tax
Note: Reports can take up to one hour to generate. If you do not see your report in the list, check again later.

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

Note: If you are attempting to reconcile a previous year’s Form 1099-K, please be aware that the calculation in step 7 above will include marketplace facilitator tax (if applicable).

The transaction 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 U.S. 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.

Note: Invoiced orders are required to be reported on the date of the transaction, while the Date Range reports in your Seller Central account are based on the date you received the funds into your account. Due to invoicing, you may see a difference in reported amounts month over month, or an overlap between December and January.
Important: Information in this document does not constitute tax, legal, or other professional advice and must not be used as such. If you have other questions, please contact your tax, legal, or other professional adviser.

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