Registration under New Remote Seller and Marketplace Facilitator Tax Laws Opens September 9

Out-of-state sellers and marketplace facilitators required to file and pay transaction privilege tax (TPT) in Arizona can now register with the Arizona Department of Revenue effective Monday, September 9.

Legislation signed into law on May 31, 2019, requires certain remote sellers and marketplace facilitators to file and pay TPT in the state starting October 1.

A 2018 ruling by the U.S. Supreme Court in the South Dakota v. Wayfair case allows states to require out-of-state businesses without a physical presence to collect and remit tax on sales from transactions in their state.

Out-of-state sellers can go to www.AZTaxes.gov to register for a license and file and pay TPT. As part of the application process a series of questions will assist businesses in determining whether they are subject to transaction privilege tax in Arizona and need to obtain a TPT license.

To further assist remote sellers and marketplace facilitators, the department has a dedicated section on its website – http://www.azdor.gov/out-of-state-sellers – that contains TPT requirements, frequently asked questions, examples, links and other information.

Additionally, the Department of Revenue’s E-Commerce Compliance and Outreach (ECCO) team is in place to assist remote sellers and marketplace facilitators with questions about the legislation and the licensing and registering process. Agency specialists are also providing support to Arizona-based businesses selling into other states with similar remote seller tax requirements. The ECCO unit can be reached Monday to Friday from 8 a.m. to 5 p.m. (MST) by phone: 833-293-7253 (833-AZeSale) or by email: azesale@azdor.gov.

Next Important Dates

October 1, 2019 – the new tax laws for remote sellers and marketplace facilitators take effect. Out-of-state sellers that meet the thresholds and other requirements will begin collecting TPT.

November 1, 2019 – remote sellers and marketplace facilitators will begin filing and paying TPT for the October period.

Remote Sellers

A remote seller makes direct sales to Arizona customers and ships products into Arizona, but does not itself have a physical presence in the state. Physical presence includes having a storefront, people or equipment in Arizona. A remote seller will be required to pay TPT if in the current or previous calendar year annual gross proceeds or gross income derived from direct sales into Arizona is more than $200,000 in 2019, $150,000 in 2020 and $100,000 in 2021, and beyond.

Marketplace Facilitators

A marketplace facilitator is any business facilitating the sale of goods by listing or advertising items on behalf of others, accepting payment on behalf of the seller and remitting payment to the seller. A marketplace facilitator will be required to collect and remit TPT if in the current or previous calendar year annual gross proceeds of sales or gross income through its platform exceeds $100,000 into Arizona.