E-Commerce & Digital SellersAnswered

Do I need to charge sales tax on digital products sold through my foreign-owned LLC?

CF
claire_fr_649dnew member
December 15, 2019 1,567 views 1 answer
digital productssales taxe-booksonline coursesforeign LLCstate taxdigital goods

My foreign-owned LLC sells digital products — online courses, downloadable templates, and e-books. I'm from France and the LLC is registered in Delaware. Sales are about $75,000/year, with customers spread across all 50 states.

I know physical products are usually taxable, but what about digital-only products? My understanding is that sales tax rules for digital products vary by state, which is incredibly confusing. Some states seem to tax them, some don't, and some only tax certain types.

How do I figure out which states I need to collect sales tax in for digital products?

Related Questions

EcommerceAnswered

My foreign LLC sells e-books, online courses, and software downloads — how is this income taxed?

I'm an Israeli entrepreneur running a foreign-owned Delaware LLC. I sell three types of digital products: e-books on Amazon Kindle, online courses on my own platform (Teachable), and a software tool a...

NI
noa_il_4696·Apr 29, 2018
1,6781
EcommerceAnsweredFeatured

How do I determine if my foreign-owned LLC's e-commerce income is effectively connected income (ECI)?

I've read through all the threads here about ECI and I'm still confused. Everyone says 'it depends on the facts' but no one explains how to actually analyze those facts. I run three different business...

MA
martin_ar_841f·Aug 14, 2023
2,8901
EcommerceAnswered

Etsy says it remits U.S. sales tax for me. Do I still need to think about U.S. state filings at all?

I sell handmade products from Turkey through an Etsy shop using a New Mexico LLC. Etsy's help center says it automatically calculates, collects, and remits U.S. sales tax when marketplace rules apply....

ST
selin_tr_5632·Oct 26, 2024
2,1501
EcommerceAnswered

I have an Etsy shop selling handmade goods through my foreign-owned LLC — what taxes do I owe?

I'm a German citizen living in Berlin. I opened a Wyoming LLC and started selling handmade jewelry on Etsy to U.S. customers. I make everything at home in Germany and ship internationally. Revenue is ...

KD
katrin_de_f3ad·Jun 4, 2018
1,7891
EcommerceAnsweredFeatured

I run a SaaS business through my foreign-owned LLC — are subscription revenues subject to U.S. tax?

I'm from Poland and I built a project management SaaS tool. I formed a Delaware LLC to accept payments from U.S. and international customers. Everything runs on AWS and I manage everything from Warsaw...

TP
tomasz_pl_9def·Nov 17, 2023
2,5671
EcommerceAnsweredFeatured

I run a Shopify store through my foreign-owned LLC — what tax compliance do I need?

I'm from Australia and I have a Delaware LLC that runs a Shopify store selling custom phone cases to U.S. customers. I handle all orders from my home in Sydney — I use a U.S. 3PL (third-party logistic...

OA
olivia_au_fb94·Nov 30, 2020
1,9561
EcommerceAnsweredFeatured

How does the Wayfair decision affect my foreign-owned LLC's sales tax obligations as an online seller?

I've been selling online through my foreign-owned LLC for 3 years and just learned about something called the 'Wayfair decision' that apparently changed everything about sales tax for online sellers. ...

LN
lars_nl_9f4d·May 4, 2019
2,4561
EcommerceAnswered

Does storing inventory in Amazon FBA warehouses create sales tax nexus for my foreign LLC?

I run a foreign-owned LLC and use Amazon FBA. My products end up in warehouses in California, Texas, New Jersey, and a few other states I can't even track properly. Amazon moves my inventory around wi...

CC
chen_cn_cef2·Jun 4, 2022
2,1341
EcommerceAnsweredFeatured

Amazon collects tax on marketplace orders, but what about my Shopify site orders fulfilled with Amazon?

I am based in Mexico and run a U.S. LLC for a small supplement brand. Most sales are on Amazon, but I also have a Shopify store and use Amazon's fulfillment network to ship some direct website orders....

DM
diego_mx_3fd0·Nov 1, 2024
2,3801
EcommerceAnswered

I dropship through a foreign-owned LLC — products ship directly from China to U.S. customers. What are my tax obligations?

I'm from Turkey and I have a Wyoming LLC for my dropshipping business. I use Shopify for the store and AliExpress suppliers ship directly to my U.S. customers from China. I never touch the products — ...

ET
emre_tr_a801·Aug 26, 2021
1,6781

Have a similar question?

ForeignLLCTax members get expert answers with IRS citations. One CPA consultation costs $200+. Full access is $9.99/month.

Become a Member — $9.99/mo

Disclaimer: All content on ForeignLLCTax.com is created by a tax professional and is provided for general educational and informational purposes only. It does not constitute tax, legal, or accounting advice, and should not be relied upon as such. Every tax situation is different — for advice specific to your circumstances, please consult a licensed CPA, Enrolled Agent, or tax attorney. By using this website, purchasing a subscription, or accessing any tools or services, you acknowledge that no client-professional relationship is established between you and ForeignLLCTax.com or its operators. This website is not affiliated with the IRS.

Watch the walkthroughs