Marketplace Facilitator Sales Tax Liability | CPE Course

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Course Details

Course Information

smart_display Format
On-Demand
signal_cellular_alt Difficulty Level
Intermediate
work Practice Area
Corporate Tax

Date & Time

event Date
Thursday, February 6, 2025
schedule Time
1:00 p.m. ET./10:00 a.m. PT
timer Program Length
110 minutes

Credit Information

BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

$247.00

CPE

ALL

This course will provide tax professionals and advisers guidance on the key sales tax issues facing marketplace facilitators stemming from the sale of goods and services of third parties. The panel will discuss recent developments in state sales tax laws, the varying state definitions of a marketplace facilitator, key nexus considerations, collection and reporting requirements, and methods to ensure compliance and minimize liability risks in contracting with third parties to sell their goods and services.

Faculty

Michael T. Dillon

President

Dillon Tax Consulting

Mr. Dillon is an attorney and founder specializing in multistate sales and use tax matters for multistate and multinational businesses. For more than 25 years, as leader of his firm, practice leader for global accounting firms and in-house for two publicly-traded E-commcerce and Technology companies, Mr. Dillon has successfully helped companies identify multistate nexus, negotiate settlements of historical exposure, register and automate sales tax compliance processes, and address risk during M&A activity. He has successfully represented taxpayers in over 200 sales tax audits, and 500 Voluntry Disclosure Agreements (VDA), often coming in when “all hope is lost” to beneficially resolve the matter. Mr. Dillon is a member of the State and Local Tax Advisory Board for Strafford Publications. He is highly sought to lecture and author articles on sales tax matters for organizations such as AICPA, Strafford, BNA, CCH and the Center for Professional Education.

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Sylvia F. Dion

Founder & Managing Partner

PrietoDion Consulting Partners, LLC

Ms. Dion's firm specializes in providing SALT consulting and compliance Services to companies throughout the U.S. and in Europe, Canada, Australia and Asia. Her primary focus is advising U.S. and foreign companies on their multi-state nexus, the taxability of their products and services, and managing and mitigating their exposure such as through the Voluntary Disclosure process. Her industry focus is in eCommerce (online retail), Software/Technology and Manufacturing. She is a speaker, writer and avid tax blogger. Her articles on SALT issues and developments have been widely published, she is currently the author of Minding Massachusetts, a State Tax Notes quarterly column and is a contributor to SalesTaxSupport.com where she blogs on “Internet Sales Tax”, “U.S. Sales Tax for Foreign Sellers” and “Massachusetts Sales Tax.”

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Description

In recent years, virtually every state that imposes a sales tax has adopted legislation that requires marketplace facilitators to collect and remit sales tax on behalf of third-party sellers. With various conflicting state tax laws, maintaining compliance is difficult for marketplace facilitators. Third-party sellers are equally concerned with understanding the impact of shifting the collection and remittance duties to the marketplace facilitator.

In January 2024, the South Carolina Court of Appeals held that Amazon, a marketplace facilitator, was liable for sales tax prior to the Wayfair decision. This consequential ruling has led many companies and their advisers to reconsider their sales tax obligations.

Tax advisers and their client companies that operate marketplaces must grasp an understanding of recent state tax rules, nexus considerations, and reporting obligations for facilitators of sellers of third-party products and services.

Marketplace facilitators contract with third parties to sell goods and services often throughout the U.S. These facilitators enable the sales of third-party sellers by listing and offering the products or services of the seller, taking payments, collecting receipts, and managing the fulfillment of orders. This engagement with third parties may subject the marketplace facilitator to state sales tax laws requiring them to collect and report these transactions. Failure to do so can result in hefty penalties and tax liability.

An entity falling into the category of "marketplace facilitator" is not automatically subject to a state's tax collection requirements. In some states, there must be sufficient nexus with a state before it may be obligated to collect the state's sales and use tax on marketplace sales. Although there are adequate bases for economic nexus for retailers after the Wayfair decision, the same cannot be said for marketplaces due to variations of state tax rules on the economic nexus threshold.

Listen as our panel discusses key sales tax issues impacting marketplace facilitators, recent state tax legislation, nexus considerations, collection and reporting requirements, and methods to avoid penalties and ensure compliance.

Outline

Determining who are marketplace facilitators
Marketplace vs. retailer nexus standards
Recent state tax law developments
Marketplace facilitator registration, collection, and reporting
Impact on third-party marketplace sellers
Best practices for marketplace facilitators in contracting with third-party goods and service providers

Benefits

The panel will discuss these and other key issues:

What entities are considered to be "marketplace facilitators"?
Key differences between the economic nexus standards for marketplace facilitators vs. retailers
How marketplace facilitators can maintain compliance with various state tax collection and reporting obligations
Whether marketplace sellers are permitted to opt out of marketplace collection and the impact on the marketplace
What documentation requirements are imposed on marketplace facilitators?
Additional issues that marketplace facilitators should consider in contracting with third-party goods and service providers

NASBA Details

Learning Objectives

After completing this course, you will be able to:

Determine if a taxpayer is a "marketplace facilitator" for sales tax purposes
Recognize the differences of the economic nexus standards as applied to retailers vs. marketplace facilitators
Identify variances and potentially conflicting state sales tax rules applicable to marketplace facilitators
Understand the liability and audit exposure imposed on marketplace facilitators
Ascertain a detailed understanding of sales tax registrations, collection, and reporting obligations of marketplace facilitators

Field of Study: Taxes
Level of Knowledge: Intermediate
Advance Preparation: None
Teaching Method: Seminar/Lecture
Delivery Method: Group-Internet (via computer)
Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
Prerequisite: Prerequisites: Three years+ business or public firm experience at mid-level within the organization, dealing with complex multi-state sales and use tax collecting and reporting; supervisory authority over other preparers/accountants. Knowledge of the U.S. Supreme Court's ruling in South Dakota v. Wayfair, Multi State Tax Commission model nexus standards, and the primary nexus approaches used by most states.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.