What Documents are required to sell on Amazon
- Dilawar Hussain
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The moment you click the sign up as a seller button on Amazon is when your eCommerce journey begins. It’s just the start, so you can be pretty sure that there’s a lot to come.
Signing up for an account to sell on Amazon is fairly easy, but we always recommend newcomers to create a checklist of things they need before signing up to make things easier for them. We are going to tell you about all the documents and information that you need to start selling on Amazon right now.
What are the documents required to sell on Amazon? (Amazon Seller Account Checklist)
Here are all the documents and information you need to start your Amazon seller career and start selling on the eCommerce platform. Make sure that you have all the information at hand before signing up for a seller account on Amazon.
1. Business information
This is going to include your business name, your address, and contact information. Make sure that all the information is accurate and up to date. You need to provide your latest contact information so you don’t run into any problems when verifying your seller account.
2. Personal information
This is pretty obvious and you will mostly do it when creating the account. Add your name, contact number, and working email to create an account on Amazon. Use your personal email so you receive all the important emails directly on your email account without any problems.
3. Credit Card
You need a valid credit card number with an authentic billing address. If your credit card isn’t valid or Amazon is unable to verify it, your account will be canceled. So, you need to make sure that your credit card details are completely accurate.
4. Phone Number
You need a working phone number where you can be easily reached for verification purposes. Make sure that you keep your phone around when registering because you will receive a verification text or call from Amazon to verify your identity.
5. Tax ID
You need to add your tax identification information along with your Social Security number. If you are a company, then you need to enter your company’s Federal Tax ID number. You will be taken to a new page with a “1099-K Tax document overview” where you need to submit your tax identity information.
6. State Tax ID
If you are a company selling your products on Amazon then you might need to provide further information like your State tax ID information. State tax ID information is for the states where you have tax nexus. Tax nexus can be defined as the physical presence of your company which includes offices, warehouses, third-party logistics, and your call/customer centers.
If you are using Amazon’s FBA for fulfillment then it will further complicate the nexus implications for your business. In such cases, you need to talk to your tax attorney or an accountant who specialize in dealing with online tax nexus cases.
Do You need an LLC to sell on Amazon?
No, you don’t necessarily need to form a Limited Liability Company (LLC) to sell on Amazon. You can easily do it as an individual. However, there are cases where it’s more beneficial for you to form an LLC for selling on Amazon. There are a few reasons that might push you to form an LLC for your Amazon business.
These reasons are often related to your financial and legal protection. You may be a small seller right now, but what would you do if you become much bigger in the future? What happens when your Amazon store takes off? Or worst case scenario, when a customer sues you on Amazon? In that scenario, you need to be protected. Well, here are a few ways to form an LLC can help protect you and your assets in the online world.
Protect your growing business
The most important reason you should form an LLC for your Amazon business is to protect your small business and grow it further. If your Amazon business is the way for you to start your business, improve your brand image and recognition, and make a decent profit then you need to plan for the future that lies ahead.
More than 80 percent of small businesses (online and offline) choose a simple LLC as their structure because it’s straightforward, easy to set up, and provides the entrepreneur with the peace of mind they require. This is why you should plan from the beginning on how to protect and grow your small business as an Amazon seller.
What is an LLC?
A Limited Liability Company (LLC) is a business structure that protects both your personal assets and your business when a legal dispute occurs. An LLC is perfect for entrepreneurs who are going at it solo with a small business venture.
Here’s a quick breakdown of certain benefits that an LLC business and tax structure provide you:
- Limited liability protection
- Versatile tax status
- No ownership restrictions
- Pass through taxation
- Flexible profit distribution
- Minimal compliance requirements
Dealing with Taxes
Since you are making money by selling on Amazon marketplace, you will need to add that when filing your taxes. You might get into hot waters with the government if you don’t account for your taxes beforehand. However, when you have an LLC structure, it’s much easier to pass through your business-related taxes over to your individual tax returns which makes it easier to pay taxes on time.
Taxes pass-through your company which means that the individual members are actually taxed on an individual level and not on company level. LLCs do file tax returns, but they don’t have to pay federal income tax.
A customer wants to pursue legal action
This is the ultimate nightmare of every seller on Amazon. It’s very unlikely such a thing happens, but it’s always a possibility. Maybe the product is faulty or the buyer just feels completely ripped off, anyone can go ahead and sue your company.
This is going to drain your business and you of valuable time and financial resources. However, an LLC will keep your business assets separate from your personal ones. So, it means financially your personal assets will be protected.
These are some reasons you should consider for forming an LLC for your Amazon selling the business. It’s not completely required to created an LLC, but having an LLC to protect you and your business could be something very important for your entrepreneurial journey. To form an LLC, contact an attorney or talk to your accountant to understand the entire process.
There are not that many documents required to sell on Amazon, you just need to basic information about your business and your personal details. However, to form an LLC for your business, you need to get in touch with your attorney that will guide you through the process for forming an LLC and also guide you about all the documents that you need to form one. Forming an LLC is a great way to protect your small business and grow it to something bigger.
Let us know what you think about forming an LLC, is it better to do business as an individual or form an LLC? Comment below.