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Taxes / State tax rules / North Carolina

Selling on eBay, Poshmark or Etsy from North Carolina: sales tax and 1099-K rules

On a marketplace sale sourced to North Carolina, a marketplace facilitator engaged in business in the state is treated as the retailer and collects the sales tax, and NCDOR says a marketplace seller is required to register and file only if it has a physical presence in North Carolina and must remit use tax, or if it sells through a facilitator not engaged in business there. North Carolina uses the federal 1099-K threshold but requires every payment settlement entity that files Form 1099-K with the IRS to submit the same information to the Department of Revenue electronically, due March 31, under G.S. 105-251.2(c).

General information, not tax advice. Check with a tax professional about your own situation.

Checked against the official pages listed below on .

North Carolina in short

General sales tax:
Yes, 4.75% state rate
Marketplace facilitator law:
Yes: N.C. Gen. Stat. § 105-164.4J (S.L. 2019-246), since Feb 1, 2020
When a marketplace must collect:
gross sales in excess of $100,000 sourced to North Carolina in the previous or current calendar year, including sales as a marketplace seller and marketplace-facilitated sales
Form 1099-K:
Federal test; platforms file a copy with the state

Who collects the tax on a marketplace sale

A marketplace facilitator engaged in business in North Carolina is considered the retailer of each marketplace-facilitated sale and collects and remits the tax, whether or not the seller is registered or would have had to collect on its own. An agreement between them may not require the seller to collect on marketplace sales.

If you sell only through marketplaces

NCDOR says a marketplace seller not engaged in business in North Carolina is not required to register and file a return. If both seller and facilitator are engaged in business there, the seller is only required to register and file if it has a physical presence in the state and is required to remit use tax. If the facilitator is not engaged in business there but the seller is, the seller collects on its taxable North Carolina sales.

Registration, resale certificates and what changes when you also sell direct have their own page: North Carolina: seller's permit and resale certificate rules.

The law: N.C. Gen. Stat. § 105-164.4J (S.L. 2019-246), effective .

"A marketplace seller is only required to register and file a return if the marketplace seller has a physical presence in North Carolina and is required to remit use tax"
North Carolina Department of Revenue, Marketplace Facilitators and Marketplace Sellers Frequently Asked Questions, Marketplace Facilitators and Marketplace Sellers FAQ: Is a marketplace seller who only sells through a marketplace facilitator required to register and file a return?
"The marketplace facilitator provisions are effective February 1, 2020 and apply to sales occurring on or after that date."
North Carolina Department of Revenue, Sales and Use Tax Directive 20-1
"Line 2, “Sales for Resale” – The seller should report all sales sourced to North Carolina that were made through a marketplace facilitator engaged in business in the state and direct sales for resale on this line."
North Carolina Department of Revenue, Marketplace Facilitators and Marketplace Sellers Frequently Asked Questions, Marketplace Facilitators and Marketplace Sellers FAQ: How should a marketplace seller report sales through a marketplace and direct sales sourced to North Carolina on its sales and use tax return?

Sources: Marketplace Facilitators and Marketplace Sellers Frequently Asked Questions; G.S. 105-164.4J, Marketplace-facilitated sales; Sales and Use Tax Directive 20-1.

North Carolina's sales tax

The general state rate is 4.75%, with local and transit taxes added for most items. Mecklenburg County added a 1% local sales and use tax effective July 1, 2026, the Department's rates page notes.

Sources: Sales and Use Tax Rates.

Form 1099-K: North Carolina and the federal test

For any year a payment settlement entity must file a return under Internal Revenue Code section 6050W (Form 1099-K), it must submit the same information to the Department of Revenue in electronic form; NCDOR says state law has no provision to waive the electronic filing requirement. NCDOR sets a March 31 due date for the preceding calendar year and a $1,000 penalty for a report not filed on time.

"For any year in which a payment settlement entity is required to make a return pursuant to section 6050W of the Code, the entity shall submit the information in the return to the Secretary"
North Carolina General Assembly, G.S. 105-251.2, Compliance informational returns, G.S. 105-251.2(c)
"The form must be filed with the Department on or before March 31 for the preceding calendar year."
North Carolina Department of Revenue, Important Notice: Important Information for Payment Settlement Entities, Electronic Filing Instructions and Due Date

Rule: N.C. Gen. Stat. § 105-251.2(c) (S.L. 2017-204).

The federal test, for comparison: the IRS says a payment app or online marketplace must send a Form 1099-K when payments for goods or services total over $20,000 in more than 200 transactions, and adds: "However, they may send you a Form 1099-K with lower amounts and/or transactions." (Understanding your Form 1099-K, reviewed ). The Instructions for Form 1099-K count both parts for the calendar year, through each platform separately, and say the box 1a gross amount is figured without adjustments for credits, discounts, fees, refunds or shipping, so a 1099-K figure is not the same as profit. More on the federal rule in Form 1099-K for resellers.

Sources: G.S. 105-251.2, Compliance informational returns; Important Notice: Important Information for Payment Settlement Entities.

Worked examples

State tax on a $40 marketplace sale to Raleigh

At the 4.75% general state rate, a $40.00 taxable item carries $1.90 of state tax, plus the local and transit rate for the delivery address. A facilitator engaged in business in North Carolina collects it.

Filling in Form E-500 for mixed sales

A North Carolina seller has $8,000 of marketplace sales through facilitators engaged in business in the state and $2,000 of taxable direct sales in a period. Following NCDOR's FAQ, it reports $10,000 on Line 1, the $8,000 of marketplace sales on Line 2 (Sales for Resale), and the $2,000 in the taxable receipts column of Lines 4-12. The 4.75% state rate on $2,000 is $95.00, before local and transit tax.

A 1099-K that goes to Raleigh as well as the IRS

A platform pays a North Carolina seller $24,000 across 310 sales in 2026, over the federal test of more than $20,000 in more than 200 transactions. The platform files Form 1099-K with the IRS and, under G.S. 105-251.2(c), submits the same information to NCDOR by March 31, 2027.

Edge cases and details

  • Effective July 2, 2026, a facilitator whose only link is the $100,000 threshold is engaged in business on the first day of the first calendar month at least 60 days after its sales pass the threshold; NCDOR says retailers that passed the threshold before July 2, 2026 must register and collect immediately.
  • Facilitators engaged in business in North Carolina also collect the scrap tire disposal tax, white goods disposal tax, dry-cleaning solvent tax and the 911 charge on prepaid wireless service, as applicable, NCDOR says.
  • G.S. 105-164.4J(c) requires facilitators to give each seller its North Carolina gross sales and number of transactions no later than 10 days after the end of each calendar month.
  • No class action may be brought in a North Carolina court against a facilitator over overpaid sales tax it collected; buyers can still seek a refund under G.S. 105-164.11.
  • A marketplace seller does not need an exemption certificate for a sale made by a facilitator engaged in business in the state; the facilitator keeps those records, NCDOR says.

What to do

  1. Check whether you have a physical presence in North Carolina and whether your gross North Carolina sales, marketplace sales included, exceed $100,000 in the current or prior year; both bear on whether you register.
  2. Save each marketplace's monthly North Carolina report of gross sales and transaction counts; the statute requires facilitators to provide it within 10 days of month end.
  3. If you file Form E-500, follow NCDOR's line-by-line FAQ for marketplace sales and check with a tax professional.

Common questions

Do I have to register in North Carolina if I only sell on marketplaces?

NCDOR says a marketplace seller not engaged in business in North Carolina is not required to register and file. If you are engaged in business there and the facilitator is too, you are only required to register and file if you have a physical presence in North Carolina and are required to remit use tax.

Does North Carolina get a copy of my 1099-K?

Yes, when the platform files one with the IRS. G.S. 105-251.2(c) requires payment settlement entities to submit the same information to NCDOR, and the Department sets a March 31 due date.

When did North Carolina's marketplace facilitator law start?

February 1, 2020, for sales on or after that date, according to Directive 20-1.

Where do marketplace sales go on the E-500?

NCDOR's FAQ says a seller reports all North Carolina sales on Line 1 and reports sales through a facilitator engaged in business in the state on Line 2, Sales for Resale.

Related

General information, not tax advice

This page summarizes North Carolina's own published pages and statutes as read on , and the IRS's 1099-K pages. It doesn't say what you should file, register for or pay. Rules depend on your situation and change: check with a tax professional, or with the state's revenue department.

Sources

Official pages this page is built from, with the day each was read.

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