North Carolina Sales Tax Filing Update February 2020
North Carolina has passed a law requiring Marketplaces to collect and remit sales tax on sales facilitated through the marketplace effective February 1, 2020.
•Amazon, eBay, Etsy and Walmart began this collection on February 1, 2020.
Please review general information regarding Marketplace Facilitators and how your TaxJar Sales Tax Reports support these changes here in our FAQ.
In this article, we summarize North Carolina's state guidance on the following questions:
- Do I need to register for a sales tax license in North Carolina?
- Should I cancel my existing registration if all my sales are marketplace-collected?
- Do I need to collect sales tax on North Carolina sales on non-marketplace platforms?
- Do I still need to file returns in North Carolina?
- How do I file without paying double tax on the sales that were collected and remitted by my Marketplace?
I've never registered for a North Carolina license. Do I need to register for a sales tax license in North Carolina now?
If you are a retailer with a physical presence in North Carolina or you are a remote seller who has crossed the economic nexus threshold for North Carolina ($100,000/year in gross revenue or more than 200 separate transactions in the current or last calendar year), then you will need to register for a North Carolina sales tax license.
- However, if you have never registered for a sales tax license in North Carolina and your only sales in North Carolina are through a Marketplace and your Marketplace Facilitator collects and remits sales tax on your behalf in this state, you will NOT need to register for a North Carolina.
I have already registered for a license in North Carolina and all of my sales are Marketplace-only sales. Should I cancel my existing registration?
No. Sellers can still be held liable if the marketplace facilitator claims that there was not enough information given, and if the total economic threshold is met through dollar value or transaction amount the seller would have economic nexus with the state
Do I need to collect taxes on my North Carolina sales on other platforms?
Yes--if you have nexus in the state (physical or economic) and you make sales to customers in North Carolina on platforms outside of the marketplace that is automatically collecting and remitting, you will also need to collect tax on your end on the North Carolina orders that are processed on the other platforms.
Do I still need to file returns in North Carolina?
If you've previously registered with the state, then yes, the state expects you to remain registered and continue to file returns.
- However, if 100% of North Carolina sales are coming from marketplace facilitators and there is no physical or economic nexus in North Carolina, then no return for North Carolina is required
I still need to file returns in North Carolina. How do I do this without paying double tax on the sales that were collected and remitted by my Marketplace?
In your North Carolina TaxJar Report, you will see this direction on how to Report your marketplace sales if you hover above the icon next to Marketplace Sales:
If you make sales on other platforms in addition to the Marketplace, you'll need to make sure you remit the tax you collected for those sales when you file.
- If you're enrolled in AutoFile for North Carolina, our system will handle the Marketplace sales deduction process automatically.