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New Tax Regulations for Amazon US Sellers: What You Need to Know for 2025
In 2025 the IRS tightened reporting and documentation requirements for marketplace sellers. Amazon has updated Seller Central to reflect these changes and is requiring many sellers—especially non-U.S. taxpayers—to submit new tax forms and confirm their tax identities. This guide explains who is affected, what to do, and the exact steps you must take before December 31, 2025 to avoid account restrictions or withheld payments.
At a glance: What changed
- W-8 / W-9 updates required: Non-U.S. sellers must submit a valid W-8BEN / W-8BEN-E; U.S. sellers must keep W-9s current.
- Reporting threshold lowered: The IRS reduced the non-U.S. reporting threshold from $5,000 to $2,500.
- New Seller Central workflow: Use Settings → Account Info → Tax Information → Regulatory Compliance to submit documents.
- Deadline: December 31, 2025 — missing the deadline can trigger payment holds or account restrictions.
Who is affected?
1. Non-U.S. sellers (foreign entities)
If your company is incorporated outside the United States and you sell on Amazon.com, you must submit W-8 tax documentation (W-8BEN for individuals, W-8BEN-E for entities). Chinese sellers: enter company names in Pinyin / Romanized spelling to match Amazon’s verification process.
2. U.S. sellers with international affiliates
If you operate multiple entities or subsidiaries across borders, each entity may need its own tax documentation reflecting its specific taxpayer status.
3. FBA sellers with U.S. inventory
Sellers with goods stored in U.S. fulfillment centers (FBA) may also be subject to U.S. source income reporting depending on fulfillment and sales location.
Consequences of non-compliance
- Account restrictions: Amazon can suspend listing or selling privileges.
- Payment holds: Amazon may delay or withhold payouts until verification completes.
- Market access loss: Prolonged non-compliance could result in removal from the U.S. marketplace.
Important: Amazon has begun issuing compliance notices in Seller Central under “Regulatory Compliance.” Check your account now.
Step-by-step: How to update your tax information in Amazon Seller Central
| Step | Action |
|---|---|
| Step 1 | Log in to Seller Central → Settings → Account Info → Tax Information → Regulatory Compliance. |
| Step 2 | Review current W-8 / W-9; note expiry or mismatched details. |
| Step 3 | Complete appropriate form: W-9 (U.S. sellers) or W-8BEN / W-8BEN-E (non-U.S. sellers). Include correct legal name and TIN. |
| Step 4 | Submit and wait for Amazon verification. Save confirmation records and screenshots. |
Practical tips: How sellers should prepare
For U.S. sellers
- Audit Seller Central information periodically.
- Update W-9 if legal name, entity type, or ownership changes.
- Monitor Seller Central notifications for additional IRS-driven updates.
For non-U.S. sellers
- Double-check W-8BEN / W-8BEN-E entries for accuracy.
- Use Pinyin / Romanized names if required (e.g., Chinese sellers).
- Keep a copy of submitted tax forms and confirmation emails/screenshots.
Key impacts for sellers
- More sellers are covered: Lower threshold (from $5,000 to $2,500) increases the number of sellers that must submit tax forms.
- Greater transparency: Amazon is enforcing stricter identity and tax reporting requirements for global sellers.
- Higher risk of payment delays: Incomplete or inconsistent tax documentation can trigger withheld funds.
- Seller responsibility: Amazon now shifts more compliance duties to sellers to meet IRS rules.
Frequently Asked Questions (short)
Q1: Who must submit a W-8 form?
All non-U.S. sellers earning income on Amazon.com must submit W-8BEN (individual) or W-8BEN-E (entity) to confirm foreign status.
Q2: What happens if I miss the Dec 31, 2025 deadline?
Amazon may restrict your account, hold payments, or block your ability to sell on the U.S. marketplace until you comply.
Q3: Why was the threshold lowered to $2,500?
The IRS reduced the threshold to broaden reporting coverage of e-commerce sellers and improve tax transparency for cross-border income.
Need help updating your tax information?
If you’re unsure which form applies to your business, or need assistance updating Seller Central, our Amazon compliance specialists can help.
Contact compliance team Book a free consultation
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