Ecommerce Sales Tax: Marketplace Facilitator vs Direct Cart (Reconcile & Remit)
Get ecommerce sales tax right: marketplace-facilitator vs direct cart, nexus, liability roll-forward, and month-end reconciliations. CPA-reviewed ecommerce bookkeeping in QuickBooks or Xero.
Ecommerce sales tax is simple in theory, collect where you have nexus and remit on time, but marketplace-facilitator rules and multi-channel stacks make it easy to double-book or miss liabilities. We run an ecommerce bookkeeping workflow that separates facilitator-remitted tax (Amazon, many marketplace channels) from direct cart obligations (Shopify/Stripe/PayPal), computes nexus exposure, and reconciles Sales Tax Payable to filed returns every month. We normalize SKU/tax codes, map platform settings to the GL, and ensure tax is never recorded as revenue or cost. Each close, we reconcile bank/credit/loan accounts to statements, clear Undeposited Funds, tie payouts to deposits, and deliver a CPA-reviewed reporting pack (P&L by channel, Balance Sheet, cash highlights) with a period-lock recommendation. The result: clean liability roll-forwards by jurisdiction, predictable filings, and margins you can trust.
Marketplace Facilitator vs Direct Cart, What Belongs in Your GL
Marketplace Facilitator (e.g., Amazon; some Walmart/eBay contexts)
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Platform collects and remits. Do not book their tax as your revenue or payable. - Keep a disclosure memo and settlement reference; record $0 liability for those orders.
Direct Cart (Shopify/Stripe/PayPal/your POS)
- You collect and remit where you have nexus (economic/physical).
- Book Sales Tax Payable by jurisdiction; reconcile to returns and cash outflows.
Nexus, Jurisdictions & Product Taxability
- Monitor economic nexus thresholds (e.g., transaction count/revenue by state).
- Track product taxability (e.g., clothing/food/software) with platform codes and overrides.
- Maintain a jurisdiction register (state/city/county) for filing frequency and due dates.
Month-End Sales Tax Roll-Forward
- Channel split: facilitator orders vs direct cart orders
- Direct cart collections → Sales Tax Payable by jurisdiction
- Filing register: due, filed, paid dates; confirmation numbers
- Roll-forward: Beginning Liability + Collections – Filings/Adjustments = Ending Liability
- Variance note and CPA review → period-lock guidance
Avoid the 7 Common Sales-Tax Errors
- Booking facilitator-remitted tax as your liability or revenue
- Leaving direct-cart tax inside Revenue (inflates top line)
- Missing local add-ons (city/county) in destination states
- Ignoring Marketplace/Shipping tax settings post-migration
- No reversal entry for refunds/returns tax components
- Filing off reports that don’t tie to Sales Tax Payable
- Not retaining return PDFs and payment confirmations
Refunds, Returns & Adjustments
- Reverse revenue, fees, and tax collected proportionally; adjust Sales Tax Payable for the jurisdiction.
- Map partial refunds to contra revenue and reduce payable accordingly; keep settlement IDs on memos.
Reports You’ll Trust
- Sales Tax Payable by jurisdiction vs return totals
- Channel split report (facilitator vs direct) with volumes and tax collected
- Filing calendar with statuses and confirmation links
Frequently Asked Questions
Marketplaces remit for their transactions under facilitator rules. Your direct cart sales (e.g., Shopify) remain your responsibility where you have nexus.
We map platform tax lines to off-income memo accounts and exclude them from Sales Tax Payable; facilitator orders contribute $0 to your liability.
Use a monthly roll-forward by jurisdiction: beginning balance + collections – filings/adjustments = ending balance. We tie that to returns and bank payments every close.
Yes, your jurisdiction register includes local add-ons and threshold monitoring. We adjust collection settings and GL mapping as exposure changes.