How to File a $0 Sales Tax Return in California | Tutorial for Amazon sellers

hi this is kashim from ledger crews in this video i want to show you exactly how to file your sales tax return if you are an amazon only seller and you need to file a zero dollar return as we all know amazon is a marketplace facilitator which means that they are required by law to collect and remit sales tax on behalf of their sellers so for whatever reason if you're required to still file a return whether it be in your home state or you have any other physical presence there that you need to file a return and you're registered but you don't actually owe any tax because amazon has already paid on your behalf i want to show you how you can file that zero dollar return so you don't owe the states anything and still comply to that filing requirement but before we dive in if you haven't please subscribe to our channel and hit the bell button so every time we release a new video you will get notified [Music] okay here are the gurus most of our clients are ecommerce businesses and they sell on multi-channels it's usually a combination of shopify and a marketplace and amazon is definitely one of the most popular choices of our clients so we do this reporting a lot and i'm so excited to show you the process the step-by-step guide on how to do that so in this video i'm going to use california as an example but the logics apply to other states as well so if you finish like watch this video to the end and apply it to your state and if you have any questions definitely leave your questions in the comments and i will get back to you personally with everything that i know before we get to the actual website to file your return i want to come to the combined tax report provided by amazon first to get the data ready so when you get to the website you have all the numbers that you need this is from seller central from the tax document library and you download the combined sales tax report not the remittance only or not the marketplace but the combined sales tax report so once you get that you will um there's really only two columns that we need the first one is on column w it's tax exclusive selling price this shows how much you're selling your products um into like on each transaction and another column you really need is column a g and it says ship to state this is where you can allocate all of your revenue from column w to different states and to do that we are going to use a pivot table so click on the little arrow right here it will select everything on your excel spreadsheet then go to insert and click on pivot table make sure that it has the whole range and click on ok and then on here remember those two columns we need so we will put um the ship to state as roles because we want it to summarize the information by state and the financial information we need is the exclusive the tax exclusive selling price and you drop that down into values let's also format this so it looks it's easier to read so you just go to home and click on the comma it'll make sure everything is formatted beautifully so in this example we're going to file for california so california amazon lets you put ca or california or like arizona sometimes like there's just different ways of spelling the state abbreviated or not so sometimes you need to add both columns so california there's these two so if i do equal this number plus this number then we know the total that goes into california is this number we'll write it on here total sales into california and total sales for this period is right here down at the bottom so then we know if we do the total minus california we know this is the amount total sales into other states and we'll need all these three numbers to file the return in california correctly so i'm just gonna put it in red because this is what we need so next we're going to log into your cdtfa account so this is the first page you will see and on here the taxable total sales is the total amount that we put in here so total total sales we will put this total number of 19 292 and 11 cents usually as e-commerce you don't really have any use tags or any uh fixtures and equipment so we usually leave those com those two um spaces zero then we click on next on this next page is sales as state designated fairgrounds if you don't have any sales at fairgrounds you can leave that as zero as well and then we'll click on next again then here is the most important part this is where you claim all the deductions so you don't have to pay anything to california so these are all the exemptions slash deductions you can take so sales to other retailers for resale usually doesn't apply as for for amazon sellers maybe it applies to you um the big part um non-taxable sales and food products if you are a seller of food products on amazon this could be applicable to you but in general we want you to put sales in interstate or foreign commerce this is sales to other states so we will put sixteen six four four three nine on here to say this is sales that's going into other parts of the country delivered outside of california it's not going to california customers so then after this we still have this amount that's the sales into california we need to categorize as non-taxable and to do that we can do other non-taxable sales and scroll down there is marketplace facilitated sales and we will put that as 264772 so we're telling them out of all the sales 19 000 of sales 16 is going to out of the state and the remaining one even though it's in california it is not my responsibility because it's a marketplace facilitated sales and on here i usually tell my client to put um amazon as well so they know that it's through amazon so then uh answer all these questions do you have any credits partial exemptions adjustments it's usually no and then to the next page it will ask you to allocate anything on districts but there's nothing to allocate because it's already zero so then you can go to next and um if you have any prepayment this will show up on there and it's usually zero because there's no access tax that's collected everything's done through amazon so then you can review the summary and usually if you don't have any prepayments that's needed then this number should be zero as well and then all of um all of this should show zero um and then you can just come here and finish paying but usually you don't really need to pay i just want to go back and illustrate that the biggest the most important part is on this page you want to put the sales in interstate or foreign commerce on here from your pivot table that sales into other states and then the rest of your actual california sales put it on here so then the total non-taxable sales equals your sales from the first page and then you will have a zero dollar sales tax liability that was for california but the logic of reporting your total sales and then reporting deductions that equals your sales so then you arrive at a zero dollar return is the same for all the states maybe they say the description a little differently instead of saying marketplace facilitated sales they would say sales through a marketplace so just on your returns especially the deductions part look at options to record marketplace facilitated sales or um anything in that ballpark that would say okay i did make sales but i all of my sales are through a marketplace and they've collected and limited on my behalf so i don't owe anything at the end of the day um one special thing about california is it asks you to report gross sales so sales into all the country all the sorry all the states and then they want you to report the sales into other states versus sales into california but for some other states they only want you to report sales into their own state you don't even need to worry about sales that are going into other states and claim that as a deduction for example if i was an amazon seller in utah then when i did when i do that pivot table i would only look at how much sale is going into utah because utah doesn't require me to report my all of my sales they only worry about sales into utah so i would let me switch to let me share my screen again so we can look at the amazon report okay so this one let's go back if i was reporting only in utah then on here where is utah okay so there's two again then for utah i would add up this one plus this one so i would report 414 and 22 cents as my gross sale instead of the 19 number because they don't ask me to report all sales and then i would take the same amount as a deduction whether it says it's sales through marketplace or marketplace facilitated sale however the wording is there should be an exemption for marketplace sale i would take the whole amount so this would be my total sales into utah and this would also be my deduction and the reason is marketplace facilitated sales and then it my tax due would be this amount minus this amount which is zero dollars so this should be applicable to all the other states whether you need to report just the sales into the state or like california they want you to report total sales for this period then you need to bifurcate it into sales into other state as one deduction and then total sales into california as deduction 2. so one of these should make sense as i mentioned in the beginning of the video if you have any questions if you're filing a zero dollar return uh in another state that's other than utah or california and you're confused please leave me a comment and i'm more than happy to look into it for you to tell you where you should put your exemption amount so you don't have to pay the states anything because amazon has already paid on your behalf um if you have any requests for videos that i should make leave it in a comment as well i sincerely i value those comments so much it gives me ideas and it lets me know how i can help you um as always if you haven't please subscribe to our channel and i'll see you in the next video bye

Channel: LedgerGurus

Views: 29,002

Keywords: how to file a $0 sales tax return in california, online sales tax, ecommerce sales tax, how to file sales tax return online, $0 sales tax return, california sales tax, Amazon seller sales tax, How to file a $0 sales tax return, How to file a $0 sales tax return for Amazon sellers, california sales tax filing, california sales and use tax return amazon, how to file a zero tax return, amazon seller sales tax report, california sales tax tutorial, Amazon marketplace facilitator laws

Id: BlxgcWxPgt8

Length: 13min 48sec (828 seconds)

Published: Sat Apr 30 2022