Thursday, June 30, 2011

Seriously? Democrats shut down the Amazon Aff Program in these states! Morons!

What To Do When Amazon Shuts Down Their Affiliate Program In Your State


Sent to you by Chris Hunter via Google Reader:


via Make Money on the Internet by Chris Guthrie on 6/30/11

Disclaimer: I can not be held liable for any action or inaction that comes from the information shared in this blog post. Talk to your accountant and or lawyer before doing anything.

In a down economy states are always looking to find ways to increase tax revenues and deal with budget shortfalls. Sadly, this usually comes in the form of new taxes from state legislatures / governors and the new tax most threatening to our industry is the affiliate nexus tax.

What Is The Affiliate Nexus Tax?

States argue that even though an online retailer (Amazon for example) doesn't have a physical presence in their state they claim having an affiliate in the state represents a physical presence for the business because they are helping to sell the online retailers goods in their state (silly huh?). So once there is a physical presence established in the state the state then says they can collect sales tax from these merchants because of the affiliate relationship.

Primary Problem With The Affiliate Nexus Tax Law: It Doesn't Work

The politicians involved in signing these laws into are either ill informed or just plain stupid because the businesses helping to promote and push these laws into existence aren't Mom and Pop shops that are "hurting" as the bill proponents would have you believe, but rather huge national retail outlets like Walmart. So as Amazon has proven time and time again, whenever the affiliate nexus tax law passes in a state they simply shut down their affiliate program and then the state not only isn't able to claim sales tax revenue they thought they could, they also end up hurting thousands of people that rely on affiliate program income to make a living.

Political Debate Time:

I generally don't argue about politics because my policy is that I'm not rich enough or powerful enough (yet) to cause any real change and the person I'm arguing with is likely equally unable to create any real change. With that said, I was reading about Amazon shutting down their affiliate program in California in September and I did some research into the states that have passed these laws and I thought I'd point out some interesting data I found:

Governors And Their Party Affiliation:

Jerry Brown – California – Democrat
Pat Quinn – Illinois – Democrat
Bill Ritter – Colorado – Democrat
Dan Malloy – Connecticut – Democrat
Beverly Perdue – North Carolina – Democrat
Neil Abercrombie – Hawaii – Democrat
(Info collected via Wikipedia)

The nexus law totally sucks but as you can see, every single state that passed this law had a Democrat governor in office. Yes, state legislation plays a role in these bills coming into fruition, but the governor always has the option to veto these bills. Now we could argue politics all you want but what's done is done, just keep this data in mind when 2012 election time rolls around. /Debate End Now let me just share how others have gotten out of this mess.

How To Set Up A Business In A Neighboring State:

Disclaimer: Again I repeat – I am neither an accountant or a lawyer, the advice I'm about to share is based on what I've heard other affiliates do when the nexus law passes in their state. Consult with your accountant and/or a lawyer before doing anything outlined here.

Step 1: Create an out of state LLC or other business entity
Step 2: Use a registered agent service to forward your mail
Step 3: Open a bank account in the new businesses name
Step 4: Voila, you can now reapply to various affiliate programs that were shut down because of the affiliate tax nexus law under your new business

Overall Advice:

As with most things in life when someone throws up a roadblock the easiest thing to do is not look for a way to get around it. But, if you're willing to put in a little work and hustle to make your business work even in the face of various obstacles thrown at you I'd suggest the alternative of simply moving onto other affiliate programs and other forms of website monetization. Remember there are thousands of ways to make money online you just need to pick one that works for you.

Need To Sell Your Amazon Website Now?

If Amazon has shut down their affiliate program in your state and you're not interested in pursuing the above please contact me if you have Amazon focused websites you're looking to sell now. We may be able to work out a deal: Get Rid Of Your Website


Things you can do from here:


No comments:

Post a Comment