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The Amazon Tax Exemption Program

  • Mar 15, 2015 | Ryan O'Donnell

There are many organizations and individuals who qualify for tax-exempt status. Governments, non-profits, agricultural professionals, and educational institutions are just a few examples. The Amazon Tax Exemption Program (ATEP) offers a way for these organizations to make tax-exempt purchases on qualifying Amazon goods at the line-item level.

The ATEP program is meant to make managing sales tax exemptions easier for Amazon shoppers. However, it only applies to goods sold through Amazon.com LLC, Amazon Digital Services, Inc., Warehouse Deals, Inc., Amazon Services LLC, or other participating sellers and does not apply to goods purchased from third-party sellers.

Businesses making tax-exempt purchases from third-party sellers on Amazon still must provide a valid tax exemption certificate to the seller.

Getting Started

To enroll in ATEP, visit your Amazon account, click on “Settings”, and select “Amazon Tax Exemption Program (ATEP)”. Once enrolled, businesses are encouraged to use the Amazon Tax Exemption Tool to make the setup process easier. ATEP offers two options for users. Have the necessary paperwork available before you begin the process.

  1. Have Amazon Create Exemption Certificates: For most states, Amazon can create your exemption certificates with their online tool. Most certificates are activated in approximately 15 minutes.
  2. Upload Your Own Exemption Certificates: For some states, you are required to upload your own completed exemption certificates. Usually, certificates are reviewed and activated within 24-hours.

Making Tax-free Purchases

With a valid exemption certificate on file with Amazon, buyers may make tax-free purchases. In the event of a mistake during checkout, take the following actions:

  • Tax Exempt Status Not Applied: Should you fail to apply your tax-exempt status to a purchase, you may email Amazon and request a tax refund.
  • Tax Exempt Status Applied by Mistake: Should you apply your tax-exempt state to a purchase that does not qualify for tax exemption, you will need to pay use tax on the item.

Tax exemption can be applied to any Amazon account. However, we recommend businesses create a separate business account and enroll it in ATEP versus using a personal Amazon account for business reasons. Moreover, tax exemption may be controlled at the group level by account Administrators.

For more information on ATEP, contact Amazon. If you're an Amazon Seller, be sure to check out our free guide to setting up sales tax on your Amazon account.

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Ryan O'Donnell
Avalara Author Ryan O'Donnell

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