How an Amazon Seller Gets Ready for the Tax Filing Period

Hey there, fellow entrepreneur! If you're selling on Amazon and tax season is creeping up, you're probably wondering how to get all your numbers in order without pulling your hair out. As someone who's been through the startup trenches, I get it. Taxes can feel like a maze, especially if you're running your business as an LLC. But don't worry, we're going to break it down step by step in a simple way.

Okay, let's talk about tracking your sales and expenses as an Amazon seller. There are a bunch of ways to do this. Some folks use fancy automation tools that pull your order data straight into accounting software like QuickBooks or Xero. That's great if you're tech-savvy and want things on autopilot. But today, we're focusing on a straightforward manual method that's perfect if you're just starting out or prefer keeping it simple.

Step 1: Head to Amazon Seller Central

Log into your Amazon Seller Central account (that's the dashboard where you manage everything). From there, navigate to Payments > Reports Repository ↗. This is where Amazon stores all sorts of reports you can generate.

Once you're on that page, set the Report Type to Summary. Then, for the Reporting Date Range, choose Month. Pick the specific month you need (or go one by one for the whole year). Hit that "Request Report" button, and Amazon will create a PDF for you. It might take a minute or two, but it'll show up in your reports list when it's ready.

Step 2: Download and Review Your Amazon Summary Report for Taxes

The report comes as a PDF, and it's packed with useful details on your income and expenses for that month. This is gold for putting together your Profit and Loss (P&L) statement and Schedule C (that's the form sole proprietors or single-member LLCs use for business income on their taxes).

Here's what to look for in the report:

• On the left side: You'll see a Total Income value. This is basically your sales revenue — plug it straight into the "Sales Income" line on your P&L and Schedule C.
• On the right side: There's a Total Expenses amount, plus a separate Cost of Advertising line. The advertising cost goes into its own expense category in your tax forms. The rest of the total expenses? That's other business costs you can deduct — things like fees or refunds. The report breaks it all down, so you can dig into the details if needed.

Pro tip: If you're selling on multiple Amazon marketplaces (like Amazon.com, Amazon.ca, or others), make sure to generate a separate report for each one. They don't combine them automatically, so you'll need to handle them individually.

Step 3: Organize and Share with Your Accountant

Once you've got your monthly reports, save those PDFs in a safe spot — like a dedicated folder on your computer or cloud drive. When tax time rolls around, bundle them up with your full P&L and Schedule C, and send everything to your accountant. These reports back up your numbers and make their job easier.

Oh, and one more thing about Amazon's tax forms: They automatically send you a 1099-K if your U.S. sales hit $5,000 or more in a year. That's their way of reporting your income to the IRS. But if you're a new seller and haven't reached that threshold yet, you won't get one — which is why pulling these manual reports is so handy.

Wrapping Up

There you have it — a simple way to prepare your Amazon data for taxes. This method keeps things manual and under your control, but if your business grows, definitely look into those automation tools to save time. Remember, we're all about making this journey from zero to LLC as smooth as possible, but taxes are serious business. Chat with a pro, stay organized, and you'll be golden.

If you've got questions or want more tips on running your U.S. LLC, check out our main guide at fromzerotollc.com. Let's keep building! 🚀