ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

What is the Affiliate Nexus Tax? (The Internet Tax/Amazon Associates Tax)

Updated on December 21, 2011
Affiliate Nexus Tax (The Internet Tax)
Affiliate Nexus Tax (The Internet Tax)

There is a relatively new tax that is aimed at affiliate marketers.

The new tax has been called the Amazon tax because members of the Amazon Associates program (Amazon's Affiliate program) were so negatively impacted - to the point where Amazon simply dropped its affiliates in the affected states.

Some people call it the affiliate tax, or the Internet tax, but it is commonly accepted as the Affiliate Nexus Tax.

Due to a bad economy, legislators are looking for any way to make a buck, so they aimed their sites on the virtually tax untapped world of affiliates who make money on the Internet.

If you make money online as an affiliate marketer, or if you're even thinking about making money online, it is a good idea for you to understand this e-commerce tax.

So, OK...What is the Affiliate Nexus Tax?

So basically, these bills (proposed or passed) are based on the idea that a specific merchant's affiliates are actually members of the merchant's sales force (the first law).

State legislators assert that if a merchant, such as Amazon, has affiliates in their state, the merchant is actually operating a business in their state.

They use the flawed analogy to tell the merchants that since they are viewed as operating a business within their jurisdiction, the state has a right to tax them as if they were any other business in that state.

The merchant then turns around and says "We don't want to pay that outrageous tax," so they then turn around and drop their affiliates in the states where the bill has become law.

That is exactly what happened with Amazon, and thousands of people had their financial security pulled right out from underneath them.

People were making a few bucks a month to a few hundred thousdand dollars a year with the Amazon Associates program, and they were dropped instantaneously.

As you can see, this tax was devastating to some people.

The bill has been passed in a few states already (NY, NC, RI) - CA recently shot down the bill.

How a Bill Becomes Law

What You Can Do About the Affiliate Nexus Tax

First of all, for your financial stability, you need to diversify your online passive income stream.

Make sure you are not an affiliate marketer for only one merchant. Also, start thinking about creating your own product.

You should know that not all merchants have dropped their affiliates in the affected states, but hundreds have.

The next thing you can do is fight back - get the contact information on your local representative and let them know how you feel about the affiliate nexus tax.

Finally, you should keep abreast of what is going on with the Affiliate Nexus Tax by visiting the Performance Marketing Association web site every once in a while.

Always Remember and Don't Ever Forget

The state and federal government is trying desperately to get their hands on the funds of people who make money on the Internet.

They have been trying for years, and they have gained decent mileage with this new tax.

Big Brother is watching and they are constantly thinking of ways to get at your money - you've got to stay one step ahead of them in order to survive.

Comments

    0 of 8192 characters used
    Post Comment

    • justmesuzanne profile image

      justmesuzanne 

      6 years ago from Texas

      They are already getting their hands on the money of people who earn money online. We are required to pay outrageously high taxes as self-employed independent contractors.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)