Amazon FBA taxes: everything a seller has to file

Which taxes does an Amazon FBA seller deal with?

How is Amazon income taxed?

Your taxable profit is not your sales. It is gross sales, minus refunds, Amazon's selling and fulfillment fees, advertising, the cost of the goods you sold, and your other business expenses. Where that profit is reported depends on how the business is set up:

• as an individual or single-member LLC: Schedule C of Form 1040,
• as a multi-member LLC: Form 1065, with a K-1 for each member,
• as an S corporation or C corporation: Form 1120-S or Form 1120.

Nothing is withheld from Amazon payouts, so most sellers pay estimated tax each quarter. See estimated quarterly taxes.

How does inventory affect your tax?

Stock you buy is not an expense when you pay for it. It becomes cost of goods sold when it is sold. Stock still sitting in FBA warehouses at year end is an asset, not a deduction. To get this right you need to know, for each product, what each unit cost you delivered to Amazon, including freight and duties, and how many units you sold, lost or had reimbursed. Amazon's inventory reports and your purchase invoices together give you those figures.

For importers, see import duties and landed cost. Arbitrage sellers should see retail arbitrage taxes.

What is Form 1099-K from Amazon?

Amazon reports sellers' gross payments to the IRS on Form 1099-K when payments are over $20,000 and there are over 200 transactions in the year, the federal threshold restored in 2025. Some states require forms at lower amounts. The 1099-K shows gross sales, before fees and refunds, so it will not match your profit. Report your actual income and expenses and keep the reconciliation. If you receive no 1099-K, the income is still taxable. Other marketplaces work the same way. See eBay seller taxes and Etsy seller taxes.

Do Amazon sellers pay self-employment tax?

If you sell as an individual or through a single-member LLC under the default rules, yes, on your net profit. For 2026 that is 15.3% on 92.35% of profit, with the Social Security part capped at $184,500 of earnings. See self-employment tax explained.

What about sales tax?

Amazon collects and remits sales tax on Amazon orders in every state that has one. Your own obligations arise in two ways: FBA inventory stored in a state, which some states treat as requiring registration, and sales through your own website or other channels that do not collect for you. Dropshipping adds a supplier to the chain. See dropshipping taxes. The details, with the California and Texas rules, are in sales tax for Amazon FBA sellers.

Can FBA inventory trigger other state taxes?

Yes. States with income, franchise or gross receipts taxes have their own rules on when an out-of-state seller owes them, and inventory can count. The Texas Comptroller, for example, states that a remote seller that is a taxable entity with inventory temporarily stored in a marketplace provider's Texas facility has Texas franchise tax responsibility. Texas charges no franchise tax below its revenue threshold, $2.65 million for 2026 reports, but still expects an information report.

Do you file anything for people you pay?

If you pay US contractors, such as a photographer or a virtual assistant, you file Form 1099-NEC for each one you pay $2,000 or more during 2026, up from $600 for earlier years. Collect a Form W-9 before you pay them. Employees mean payroll, with its own filings.

What if you live outside the US?

Whether your Amazon profit is taxable in the US depends on where the business is carried on, and inventory in US warehouses is one of the facts that matters. See whether foreign-owned US LLCs pay US tax. The full picture for non-resident sellers is in selling on Amazon US from outside the US. A single-member US LLC owned by a non-resident files Form 5472 every year it has transactions with its owner.

Which records should you keep?

• Amazon settlement and transaction reports for every period.
• How to turn those reports into books is covered in bookkeeping for Amazon sellers.
• Supplier invoices, freight and customs documents for each shipment.
• Inventory reports showing units received, sold, lost and reimbursed.
• Your Form 1099-K and a reconciliation to your books.
• Records of where your inventory was stored.

This guide is general information. It is not tax or legal advice for your situation.