Amazon Tax Exemption Program (All You Need to Know)

Amazon Tax Exemption Program is a maximum tax saving program of Amazon. With the program, any organization or government department located in eligible states can order as many goods and services as they want, paying no state sales tax. The Amazon Tax Exemption Program can help you avoid paying sales taxes when buying products shipped and sold by Amazon.

Most times, you'll need to enroll directly with Amazon by using the link provided on their website. This is an excellent alternative to finding wholesalers, which can be challenging as you sign up with other distributors and carry their inventory, shipping times, and pricing. Read on for more information.

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What Is Amazon Tax Exemption Program?

Tax-exempt purchases may be available to businesses and organizations. Amazon, its affiliates, and participating independent third-party sellers can offer customers tax-exempt purchases of their items through the Amazon Tax Exemption Program. The ATEP allows eligible organizations to purchase qualifying products from a list of items at no sales tax.

This lowers costs for your organization and helps you make better purchasing decisions by providing more information about the cost of products available on Amazon.com. If you are a tax-exempt business or organization, you can use ATEP to purchase qualifying products at a discounted price.

You will receive an email from Amazon informing you that your order has been processed with ATEP discounts. Enter your organization's EIN or federal tax ID number, billing address, and payment information at checkout.

Why Is There Tax On My Order?

In the following circumstances, you may be charged tax on your order:

Currently, you have not enrolled in Amazon's tax exemption program.
The product you ordered is taxable in your state or country.
The seller of an item is required by law to collect and pay sales tax on it, even if they are not in your state or country.
Your order will ship to a state where you aren't tax-exempt.
The item you purchased does not qualify for your tax exemption certificate.

How to Apply For Amazon Tax-Exempt Status?

A tax-exempt status application from Amazon is relatively straightforward. Complete the Amazon Tax Exemption Wizard to determine your eligibility for Amazon tax exemptions. Once you have completed it, you can apply for tax exemption by filling out a few more personal details, including your tax identification number, complete street address, and contact information.

Once you've submitted this information and received confirmation from Amazon that your application has been received, you can access your account and begin using the tax exemption program.

Amazon Tax Exemption Program Terms and Conditions

These Amazon Tax Exemption Program (ATEP) Terms and Conditions (the "Terms") govern your participation in the Amazon Tax Exemption Program (ATEP). The following terms and conditions apply to your participation in the Amazon Tax Exemption Program ("ATEP").

1. Requirements For Tax Exemption

You must provide the relevant state tax authority with a tax exemption certificate, equivalent documentation, or information to qualify for tax-exemption status. Before applying for state sales and use tax registration, this document must be provided.

Your eligibility for Amazon Tax Exemption is based on your physical location and business activities. If you are eligible for Amazon Tax Exemption, you will receive an email from them acknowledging your eligibility.

2. Representations, Warranties, And Indemnity

It is your responsibility to ensure that any tax documentation or information you provide is accurate and valid and to provide updates as necessary to maintain the accuracy of that documentation.

In addition, you represent, warrant, and agree to use the Amazon Tax Exemption Program (ATEP) solely to claim exemption from sales tax on purchases made through Amazon. You further represent warrant and agree that ATEP will not be used by anyone other than yourself or an authorized representative.

3. Changes In Status; Termination

If Amazon deems it necessary, it may refuse your access to ATEP, suspend or revoke your tax configuration for a specific tax jurisdiction, or terminate your participation in ATEP for any reason, including but not limited to violating these Terms.

Amazon reserves the right to modify or discontinue ATEP ‌without notice. You will receive notification of any material changes to ATEP and have 30 days from the date of such information to terminate your participation in ATEP.

4. Restrictions

Only Amazon-affiliated entities and other participating sellers are eligible to use ATEP's tax-exempt configurations. For example, if you operate under multiple accounts under different business names, each business name must be registered as a separate participant in ATEP. ATEP is available only in select states and localities, which may change.

The ATEP program requires a valid tax exemption certificate that shows that you are entitled to the tax exemption under applicable law. Participants may not sell products subject to sales tax in states where they do not have nexus, such as certain digital goods, digital subscriptions, and digital software subscriptions.

5. Additional Jurisdictions

What would it do if Amazon decided to collect tax in a new state or local jurisdiction? To be considered for tax exemption status in the new jurisdiction, you must submit valid documentation for that jurisdiction, regardless of any previously provided documentation. If your information is already on file with Amazon, they may not need additional documentation from you.

Amazon will notify you if this is the case and will not require additional submission. Suppose Amazon reviewed and approved your account before this policy was implemented. In that case, it will remain approved unless we update our information systems to reflect the new policy.

6. Changes To Agreement

The Amazon Terms of Service may be updated, at Amazon's sole discretion. The updated Agreement will be effective upon being posted to the Amazon website. It is your responsibility to check this page periodically for changes.

Your continued use of any Product following the posting of changes will constitute acceptance of those changes. Agreement means that you agree to all the changes in it. Therefore, you must check this page frequently for updates so that you always know what terms and conditions apply to your participation in ATEP.

Bottom Line

The Amazon Tax Exemption Program is an opportunity for small, independent sellers to be notified when applicable tax-exempt organizations purchase products through Amazon Associates advertising links.

To ensure that tax-exempt organizations receive tax exemption or resale certificates from sellers in a timely manner, the Amazon Tax Exemption Program notifies sellers when applicable tax-exempt organizations purchase products through the Associates program.