Amazon Prime Day Prep: Sales Tax Compliance Checklist for Multi-Channel Sellers

Amazon Prime Day drives massive sales spikes that can suddenly push your e-commerce business into new tax jurisdictions. In fact, the platform saw $14.2 billion in sales in a two-day period in 2024, making it one of the biggest selling days of the year. So while you may be focusing on inventory management and marketing campaigns, sales tax is waiting for you in the wings, waiting to create costly headaches if you’re unprepared.

The reality is stark: a single high-volume sales event can trigger economic nexus thresholds in multiple states, creating immediate filing obligations you didn't have before Prime Day started. Smart multi-channel sellers prepare their tax compliance strategy well in advance of the sales surge.

Here’s what you need to know.

Understanding Your Prime Day Tax Exposure

Prime Day isn't just about increased revenue—it's about expanding your tax footprint geographically. When sales volume jumps 300-500% over two days, you might suddenly meet economic nexus thresholds in states where you've never had tax obligations.

Economic Nexus Thresholds

Economic nexus thresholds vary by state, but are usually based on a revenue or sales threshold amount. When you reach nexus in a state, you’ll need to register and begin collecting sales tax immediately.

This is generally how economic thresholds break down:

• Most states: $100,000 in sales or 200 transactions
• California: $500,000 in sales
• Texas: $500,000 in sales
• New York: $500,000 in sales and 100 transactions

The challenge intensifies for multi-channel sellers. Your Prime Day sales combine with existing revenue from your Shopify store, eBay listings, and other marketplaces. This cumulative effect often pushes businesses past multiple state thresholds simultaneously.

Amazon as Marketplace Facilitator

Understanding Amazon's role as a marketplace facilitator is crucial for Prime Day tax planning. This designation affects how sales tax is collected on your Amazon sales and determines your remaining compliance obligations.

• Amazon collects and remits sales tax on FBA and FBM sales in all states where it has marketplace facilitator obligations. This covers most states, but important exceptions remain that create ongoing compliance requirements for sellers.
• The good news: Amazon handles the heavy lifting for most of your Prime Day volume. When customers purchase your products through Amazon, the platform calculates appropriate tax rates, collects the tax at checkout, and remits payments to state tax authorities on predetermined schedules.
• You still need to track these sales for your own nexus calculations. Amazon's tax collection doesn't eliminate your economic nexus obligations—it just shifts the collection and remittance burden away from you for those specific transactions.
• Amazon provides detailed tax reporting through Seller Central, including state-by-state breakdowns of sales volume and tax collected. This data becomes essential for monitoring your approach toward economic nexus thresholds and managing compliance across your entire multi-channel operation.

What Amazon Doesn't Handle

While Amazon's marketplace facilitator status simplifies much of your Prime Day tax burden, several critical obligations remain your responsibility.

• States without marketplace facilitator laws still require you to collect and remit tax directly. Though rare, a few jurisdictions haven't enacted comprehensive marketplace facilitator legislation, leaving collection obligations with individual sellers.
• Local tax jurisdictions with specific seller requirements may not be covered by Amazon's facilitator obligations. Some cities and counties maintain separate registration and collection requirements that supersede state-level facilitator rules.
• Your direct sales outside Amazon remain entirely your responsibility, even when driven by Prime Day marketing. Customers who discover your products on Amazon but purchase through your website create tax obligations that Amazon cannot handle for you.
• Sales made before your state's marketplace facilitator effective date may still require separate handling if you had nexus obligations prior to Amazon assuming collection responsibilities.

Prime Day Sales Tax Checklist

Use this comprehensive checklist to ensure your tax compliance strategy effectively handles the increased complexity and volume of Prime Day.

Pre-Event Preparation (Complete 30 Days Before)

Nexus Analysis

• Calculate current year-to-date sales by state across all channels
• Identify states where you're within 25% of economic nexus thresholds
• Review physical nexus situations (inventory, employees, contractors)
• Document any changes in nexus status from previous high-volume events

Registration Status Review

• Verify all current sales tax registrations are active
• Update business information with state tax authorities
• Confirm that the filing frequencies match your expected sales volume
• Ensure you have login credentials for all state tax portals

Technology and Systems Check

• Test sales tax calculation accuracy on all selling platforms
• Verify that the tax determination software handles your current nexus footprint
• Confirm backup systems for peak traffic periods
• Update product taxability settings for any new inventory categories

During Prime Day (Real-time Monitoring)

Sales Tracking

• Monitor real-time sales by state across all channels
• Track transaction counts in states with transaction-based thresholds
• Document any technical issues affecting tax collection
• Save backup copies of all sales data in case of system failures

Threshold Monitoring

• Check progress toward economic nexus thresholds hourly during peak periods
• Have an alert system for when you approach 90% of any state threshold (or use sales tax software that notifies you when you reach nexus in a new state)
• Document the exact timing when thresholds are crossed
• Prepare for immediate post-event registration requirements

Post-Event Actions (Complete Within 72 Hours)

Nexus Assessment

• Calculate final sales totals by state for the entire event period
• Identify any new economic nexus obligations created
• Determine registration deadlines for newly triggered states
• Plan the filing frequency for elections for new registrations

Compliance Implementation

• Register for sales tax permits in newly triggered states
• Update tax determination systems with new nexus obligations
• Modify the filing calendar to include new monthly or quarterly obligations
• Begin collecting sales tax immediately in newly triggered jurisdictions

What to Know About Managing Multi-State Filing After Prime Day

Prime Day often creates a cascade of new filing obligations that can overwhelm unprepared sellers. The key is having systems in place before the complexity hits.

• New registrations typically require monthly filing initially, regardless of your sales volume. This means immediate cash flow impacts as you collect and remit taxes more frequently than is established in your registrations.
• Filing dates rarely align across states, creating a complex calendar of obligations. Some states require filing by the 20th of the month, while others require filing by the last day, and a few have mid-month deadlines.
• Penalty calculations begin immediately once nexus is established. States don't provide grace periods for businesses learning about new obligations after high-volume events.

The administrative burden multiplies quickly. A Prime Day that triggers nexus in five new states can create 60 additional filing obligations annually, each with unique requirements and deadlines.

The Hidden Costs of Prime Day Tax Mistakes

Prime Day success can create expensive compliance problems that aren't immediately obvious. Understanding these hidden costs helps you make informed decisions about your tax strategy.

How a Sales Tax Solution Can Help You Navigate Prime Day

Prime Day's complexity demands more than basic tax software—you need a comprehensive solution that combines automation with expert oversight. The right sales tax solution transforms Prime Day from a compliance nightmare into a growth opportunity.

• Real-time nexus monitoring becomes your early warning system. Professional solutions track your sales velocity across all channels during Prime Day, alerting you before you hit economic nexus thresholds rather than discovering new obligations weeks later.
• Automated registration services handle the immediate compliance requirements when Prime Day sales push you into new states. Instead of scrambling to understand registration processes in multiple jurisdictions, your solution handles paperwork and ensures you're collecting tax from day one.
• Expert tax professionals provide the human insight that software cannot. When Prime Day creates unique situations—like partial-month nexus obligations or complex local tax requirements—tax experts navigate the gray areas and ensure compliant solutions.
• Comprehensive filing management eliminates the post-Prime Day administrative burden. Your solution handles returns across all newly triggered states, manages varying filing frequencies, and ensures you never miss deadlines that could generate penalties.

Wrapping Up

Prime Day represents everything exciting about e-commerce growth—massive sales spikes, new customer acquisition, and rapid business expansion. It shouldn't also represent sleepless nights worrying about sales tax compliance in dozens of states.

The most successful multi-channel sellers recognize that tax compliance is a business process that scales with their growth and success. They invest in systems and expertise that handle the complexity automatically, allowing them to focus on what they do best: growing their business.

Ready to Handle Prime Day Without Sales Tax Stress?

Zamp's managed sales tax solution combines cutting-edge technology with dedicated tax experts who monitor your nexus obligations, handle all filings, and ensure compliance as your business grows. Our clients sleep well during Prime Day because they know professionals handle every aspect of their sales tax compliance.

Get compliant in minutes—not months. Contact our tax experts today to learn how Zamp eliminates sales tax headaches so you can focus on what matters: building your business.

About the author

Emily Kordys

Emily Kordys is a Content Marketing Manager with seven years of experience in the sales tax, auto, and real estate industries. She currently resides in North Carolina with her boyfriend and dogs, Shadow and Copr.