Do I need an EIN to sell on Amazon?

Do I need an EIN to sell on Amazon?

Many of our customers ask us if it’s possible for them to sell on Amazon. Of course! But the catch? They don’t live in the United States, and thus they don’t have an SSN or EIN. Social security numbers and employer identification numbers are crucial in the US to conducting business, mainly because of tax purposes. Amazon uses these to identify the seller, and to properly disclose sales numbers to the IRS at the end of the year. We’re here today to give you a basic crash course on this challenging hurdle, and what you can do to overcome it.

 

A little more background

Let’s go into a little more detail regarding the three reasons that you’ll need an EIN to sell on Amazon:

  1. Amazon needs a way to identify you – without a formal and standardized identification, Amazon’s marketplace would be a free-for-all. They’d have no way to ensure that people are who they say they are, and that a single person hasn’t opened 18 storefronts already. Amazon is very strict about sellers not having multiple accounts (that’s a topic for another post!), and this is one of several ways they’re able to prevent this problem from happening. Much like opening a real brick & mortar storefront versus just handing out goods for cash on a street corner, this may seem like extra hassle, but does protect sellers as well as buyers.
  2. Tax purposes for the IRS – the IRS, or Internal Revenue Service, is an agency in the US that handles all taxes for individuals and businesses. An SSN or EIN allows the IRS to, in a nutshell, monitor the amount of money received by an individual or business, and the amount they spent – checks and balances basically. Just like with Amazon needing the number for identification, without an SSN or EIN, it’d be extremely easy for people and companies to have multiple entities. At the end of each year, Amazon reports sales numbers to the IRS, which then checks these against the numbers that each of the Amazon sellers report to the IRS. Without an identifying number, Amazon can’t submit these to the IRS.
  3. Importing and customs – US Customs and Border Protection (CBP), which you may already be familiar with if you’ve been researching suppliers, requires an identifying number as well. In general, the more info that can be provided to CBP at the time of importing, the smoother the process goes, and the faster your goods will be in Amazon’s warehouses.

 

So what’s the difference between an SSN and an EIN?

In the US, every person born here is given an SSN – their identifying number for the rest of their life. It’s used for taxes, retirement, other forms of identification, and more. If a citizen with an SSN would like to conduct business in the US, he or she can do so without forming a corporation, and just using the SSN on any relevant forms. Many people who sell on Amazon do just that – but it’s usually limited to the smaller sellers.

An EIN is more common with companies, and is what you, as an international Amazon seller, will be looking to attain. An EIN can be attached to an individual or a company.

 

Now…how do I get an EIN?

  1. Before you take the next few hours to follow the next few steps…if you’re already a US citizen, you can get an EIN by two processes:
    1. Register with the IRS and get an EIN: https://sa.www4.irs.gov/modiein/individual/index.jsp
    2. Form a company in your home state, or in another state. We recommend calling our friends at Northwest Registered Agent for assistance with this, but many other services exist as well. You can also complete the registration process on your own. We are not affiliated with Northwest Registered Agent, we just recommend them through our experience.
  2. If you’re not a US citizen though, you’ll want to begin by getting a US address. We recommend NYMail if you’re looking for a prestigious and more public facing New York City address. If this is not a priority to you, then several other options exist. These services are popular these days with people looking to shop in the US, as they will send your mail to you. This makes purchasing from US sellers much easier too, as they’re often more willing to ship to a US address, than to deal with the paperwork required for exporting. Here are a few we also suggest looking at (again, we are not affiliated with NYMail or any of the below):
    1. MailboxForwarding
    2. USAMail1
    3. Viabox
  3. Next you’ll want to get IRS Form SS-4. You’ll need much of the info on this form to call the IRS, which is the next step. The IRS provides some additional instructions on SS-4 here.
  4. It’s time to call the IRS and get your EIN. This will take a fair amount of time (much of which can be hold time), but the good news is that you’ll (hopefully) be receiving an EIN today over the phone! The number you’ll want to call is +1-267-941-1099. This is not a toll-free number, and they are only open from 6:00AM to 11:00PM, Eastern Standard Time (EST), Monday through Friday. Make sure you’re the one calling, not an employee of yours – the IRS representative will require that the caller be authorized based on the information provided to them.

 

Am I all set?

Assuming you received an EIN while on the phone, then you’re all set! You can now use this to register your business on Amazon, as well as to import goods, purchase goods in the US, and more.

If you get stuck at any point in time, our helpful concierge service is here to help. Give us a call (888-311-2253) or shoot us an email (directsales@amztransit.com)!

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