Sales/Use/Indirect:
New York: Advisory Opinion Addresses if Retailer that Stores Inventory at Fulfillment Center’s In-State Warehouse is a Vendor

TSB-A-24(45)S, N.Y. Dept. of Tax. & Fin. (10/10/24). A recently posted New York Department of Taxation and Finance advisory opinion involving an out-of-state online retailer concludes that based on the provided facts, if the retailer’s only in-state presence is the storage of inventory at an unaffiliated fulfillment center’s in-state warehouses, then the retailer is not considered a “vendor” for New York sales tax purposes. The opinion notes that because the hired fulfillment company provides an internet platform on which sales of the retailer’s tangible personal property are made, and it collects the receipts from such sales from customers, then it may be considered a “marketplace provider” under state law that is required to register and collect New York sales tax if certain Wayfair nexus-type thresholds are met. According to the opinion, if the fulfillment company qualifies as a marketplace provider under state law, it must collect sales tax on all sales of tangible personal property to New York customers that it makes or facilitates, including sales of the retailer’s products, regardless of whether the services provided to the retailer are limited to fulfillment services as defined in Tax Law § 1101(b)(18). Please contact us with any questions.