First Year of Remote Seller and Marketplace Facilitators Tax Collection

With the mark of Arizona's one-year anniversary implementing the remote seller and marketplace facilitator law, the Arizona Department of Revenue has seen a steady incline in transaction privilege tax collection. Since October 1, 2019, the Arizona Department of Revenue (ADOR) has brought in more than $467.0 million in transaction privilege tax from over 4,500 remote sellers and marketplace facilitators. In fiscal year 2020 (September 1, 2019 – June 30, 2020), the department collected over $278.7 million and over $128.6 million towards the General Fund.

Under a state law that took effect on October 1, 2019, out-of-state businesses that do not have a physical presence in Arizona and meet certain economic thresholds must collect and remit transaction privilege tax in Arizona.

Next Important Dates

Beginning January 1, 2021, a remote seller that did not meet the threshold in 2020 should review its Arizona direct sales for 2020, and continuing in 2021, using the $100,000 threshold. Note that this threshold may be met at any time in 2021.

Renewals

Marketplace facilitators and remote sellers should review all Arizona sales the previous year, using the $100,000 threshold, to determine if it needs to renew its TPT license.

Renewals are due January 1 of each year.

Out-Of-State Business Assistance

The department has a dedicated section on its website - www.azdor.gov/out-of-state-sellers - that contains TPT requirements, frequently asked questions, tax rate table, and other information.

In efforts to assist taxpayers, the E-Commerce Compliance and Outreach (ECCO) team is available to support out-of-state businesses and general questions about other states' remote seller/marketplace facilitator laws for Arizona-based retailers.

The ECCO team can be reached Monday through Friday, from 8 a.m. to 5 p.m. (MST) by email at [email protected], or by phone 833-293-7253 (833-AZeSale).

Taxpayers can also subscribe to ADOR's remote seller bulletins and receive notices regarding filing requirements, tax rate changes, law changes, and reminders.

Thursday, November 5, 2020