US Sales Tax for Foreign E-commerce Sellers

First, what US sales tax actually is

US sales tax is a state and local tax on the sale of goods to a final consumer — there is no national sales tax, and each state sets its own rates and rules. This surprises sellers from countries with a single national VAT: in the US, an item sold to a buyer in Texas is taxed under Texas rules, and the same item sold to California is taxed under California rules. Crucially, sales tax is completely separate from income tax. Owing (or collecting) sales tax says nothing about whether you owe US income tax, which is a different question entirely — our guide to sales tax vs income tax pulls the two apart. Getting this distinction straight early prevents most of the confusion foreign sellers carry around.

Economic nexus: how a sale creates an obligation

"Nexus" is simply the connection that gives a state the right to make you deal with its sales tax. There are two kinds. Physical nexus comes from having something in the state — an office, an employee, or inventory. Economic nexus is newer and more important for remote sellers: a state can require you to collect its sales tax purely because you sold enough into that state, with no physical presence at all. This became the law after a 2018 US Supreme Court decision, and every sales-tax state now uses some version of it.

The common pattern to remember is a threshold of $100,000 in sales or 200 separate transactions into a single state in a year (as of 2026). Cross it, and you have economic nexus there. But treat that as a mental model, not a universal rule: the exact numbers vary by state, several large states set a higher dollar threshold and have dropped the 200-transaction count, and the thresholds are measured state by state — you evaluate each state on its own sales, not your worldwide total. The key insight is that nexus is created by where your customers are, not by where your company is formed. A Wyoming LLC and a New Mexico LLC have identical sales-tax exposure if they sell the same goods to the same buyers.

Marketplace facilitator laws: why Amazon handles it for you

Here is the development that changed everything for marketplace sellers, and the reason most foreign sellers can stop panicking. Every US state that charges sales tax has passed a marketplace facilitator law. These laws shift the duty to collect and remit sales tax from the individual seller onto the marketplace. In plain terms: when you sell on Amazon, eBay, Etsy, or Walmart, the platform itself calculates the correct sales tax, collects it from the buyer at checkout, and remits it to the state. You don't touch it.

For a seller whose sales run entirely through these marketplaces, this means the sales-tax layer is largely taken care of automatically, in every state, no matter how much you sell or where the buyers are. It's genuinely one of the few places the US system got simpler. This is also why the "form in a no-sales-tax state to avoid sales tax" advice is a myth — your formation state was never what determined marketplace sales tax in the first place, and the marketplace now handles it regardless. We make the same point in the context of choosing a state to form in.

When a foreign seller still has to register

Marketplace collection covers marketplace sales — but not everything. These are the situations where a non-resident seller still has real sales-tax work to do:

• Selling on your own channel. The big one. If you run a Shopify store or sell direct-to-consumer where no marketplace collects for you, then once you cross a state's economic-nexus threshold, you must register in that state, collect sales tax from your buyers yourself, and file returns. This is the most common way a growing seller acquires genuine sales-tax obligations.
• Inventory sitting in a state. Storing goods in a state — for example, in Amazon's FBA warehouses — can create physical nexus there. While the marketplace still collects on the marketplace sales, a handful of states expect a seller with inventory nexus to register or file an informational return anyway, so it's worth knowing which states hold your stock.
• A few marketplace-only edge cases. Most states exempt sellers whose only sales are through a collecting marketplace, but a small number still want a registration or a zero return on file. These are exceptions, not the rule, but they exist.
• Buying wholesale for resale. This isn't about collecting tax — it's the reverse. To buy inventory from US suppliers without paying sales tax on your own purchases (which you'd otherwise pay twice), you use a resale certificate, which suppliers routinely ask to see.

The through-line is simple: marketplace sales are mostly handled for you; non-marketplace sales and inventory footprints are where your own obligations begin. Knowing which bucket your revenue falls into tells you almost everything about what you owe.

A practical way to think about it

If you are a foreign seller in 2026, your sales-tax picture usually comes down to three questions. First, are your sales all through marketplaces like Amazon? If so, the platform is collecting and remitting, and your direct sales-tax burden is light. Second, are you also selling on your own Shopify or DTC store? If so, you need to monitor your sales into each state and register where you cross the threshold. Third, where is your inventory physically stored? That tells you where you may have physical nexus to check. Answer those three and you know where you stand — and you avoid both the panic of over-registering everywhere and the risk of ignoring a real obligation on your own channel.

None of this touches whether you owe US income tax, which depends on whether you're engaged in a US trade or business and on any tax treaty — and which sits alongside the annual Form 5472 that foreign-owned LLCs file regardless. Keeping sales tax, income tax, and information returns in separate mental boxes is what keeps foreign sellers out of trouble.

Frequently asked questions

Does Amazon collect sales tax for me as a foreign seller?

Yes. Marketplace facilitator laws apply in every US sales-tax state, so Amazon calculates, collects, and remits sales tax on your marketplace sales automatically. eBay, Etsy, and Walmart do the same. Your nationality or residence doesn't change this.

What are the economic nexus thresholds?

The common pattern is $100,000 in sales or 200 transactions into a state per year, but it varies — some large states use a higher dollar figure and no transaction count. You measure each state separately, based on your sales into that state.

I sell only on Amazon. Do I need to register anywhere?

Usually not, because the marketplace already collects and remits. Watch two things: states where your FBA inventory is stored, and the small number of states that still want a registration even from marketplace-only sellers. Otherwise there's typically nothing to file.

I'm launching a Shopify store too. What changes?

On your own store no marketplace collects for you, so you become responsible. Track your sales into each state, register where you cross the nexus threshold, collect tax from buyers, and file returns there. That's the point where professional help usually pays for itself.

How we help

We map your actual sales-tax footprint — which of your sales a marketplace already covers, where your inventory creates nexus, and which states your own-channel sales oblige you to register in — and then set up collection and filing only where it's genuinely required, so you're neither exposed nor over-complying. It's part of our e-commerce and Amazon practice, alongside your resale certificates and the federal filings your company owes. If you're selling into the US from abroad and want your sales-tax position handled correctly, talk to us.