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Avalara Help Center

How does TrustFile handle sales made through Marketplace Facilitators?

Overview

You sell through a marketplace that collects and remits tax on your behalf and are wondering how that is reflected in TrustFile.

Environment

TrustFile

Resolution

Sales made through a marketplace into states that have marketplace facilitator rulings will be imported into TrustFile, added onto the return for reporting purposes, and deducted from the total amount of tax due. Each marketplace remits tax into different states based on their own determination; TrustFile maintains a listing of which states each marketplace remits for and applies rules aligned to those determinations for how tax is reflected on the returns so that you do not pay for tax that has already been remitted.

For marketplaces that have a direct connection into TrustFile, such as Amazon, the transactions synced with TrustFile will have the associated rules automatically applied for that marketplace.

If the marketplace does not have a direct connection into TrustFile, you will need to indicate which marketplace it is for on the .csv file uploaded into TrustFile by putting the name of the marketplace in the filename. For example, if you are uploading a file from ebay for June 2019 you would want to save the file as ebay-June2019.csv (or something similar) so that it is easily identifiable what marketplace it belongs to and the mapping of the file can include the states that the marketplace is remitting for.

If you upload a file from your marketplace and it is placed in our mapping queue, please open a case with support to identify which states are remitting tax on the file so that it can be mapped properly.

All transactions will appear in the Transactions list in TrustFile but the amount of tax remitted already will be deducted on the actual return. When you look at the Review & File page for a state which has all tax remitted by the marketplace you will see the summary as follows, with the total tax uploaded for the state listed with the amount due as $0.

Marketplace example.PNG

 

 

Note: Many states have been passing laws dictating that the liability for tax collection and payment should fall to the owner of the greater marketplace instead of the individual sellers within that marketplace. For this reason, many marketplaces have started collecting tax on your sales into those states whether you choose them to or not and you are unable to opt-out of tax collection there. To determine your requirements for reporting and/or registration in those states it is recommended you speak with a tax professional who has experience with sales tax as some states do still expect you to register and file returns with them regardless of the payments they are receiving from the marketplaces. 

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