--- title: "Tennessee marketplace facilitator law and 1099-K rules" description: "Tennessee marketplaces over $100,000 collect sales tax since Oct. 1, 2020. Out-of-state marketplace-only sellers don't register; Tennessee-based ones should." canonical: https://resellerindex.com/tax/states/tennessee/ last_updated: 2026-10-23 publisher: "The Reseller Index" --- [Taxes](https://resellerindex.com/tax/) / [State tax rules](https://resellerindex.com/tax/states/) / Tennessee # Selling on eBay, Poshmark or Etsy from Tennessee: sales tax and 1099-K rules On a marketplace sale to a Tennessee customer, a facilitator with more than $100,000 of Tennessee sales in the previous 12 months collects the sales tax; an out-of-state seller whose taxable sales all go through such facilitators is not required to register, while the Department advises Tennessee-located marketplace sellers to register and file anyway. Tennessee repealed the Hall income tax, which applied only to interest and dividends, for tax periods beginning on or after January 1, 2021, and we found no Tennessee 1099-K rule, so only the federal test applies. General information, not tax advice. Check with a tax professional about your own situation. Checked against the official pages listed below on Oct 19, 2026. ## Tennessee in short - **General sales tax:** Yes, 7% state rate - **Marketplace facilitator law:** Yes: Tenn. Code Ann. §§ 67-6-901 to 67-6-902 (Public Chapter 646 (2020)), since Oct 1, 2020 - **When a marketplace must collect:** more than $100,000 in sales to Tennessee customers in the previous 12-month period - **Form 1099-K:** No state personal income tax ## Who collects the tax on a marketplace sale A marketplace facilitator over the threshold is treated as the retailer and collects and remits Tennessee sales tax on sales made by marketplace sellers to Tennessee customers; one under $100,000 has no collection responsibility. A newly qualifying facilitator registers and starts collecting on the first day of the third month after the month it meets the threshold. ### If you sell only through marketplaces An out-of-state seller is not required to register if all its taxable sales are made through a facilitator collecting Tennessee tax for it, and those marketplace sales do not count toward its own $100,000 test. The Department's 2024 webinar says sellers located in Tennessee should register and file even if all sales go through a registered facilitator, reporting $0 in sales on an annual return. Registration, resale certificates and what changes when you also sell direct have their own page: [Tennessee: seller's permit and resale certificate rules](https://resellerindex.com/tax/sellers-permit/tennessee/). The law: Tenn. Code Ann. §§ 67-6-901 to 67-6-902 (Public Chapter 646 (2020)), effective Oct 1, 2020. > "Beginning on October 1, 2020, marketplace facilitators that make or facilitate more than $100,000 in sales to Tennessee customers in the previous 12-month period are required to collect and remit Tennessee sales tax." Tennessee Department of Revenue, [Out-of-State Dealers and Marketplace Facilitators](https://www.tn.gov/revenue/taxes/sales-and-use-tax/out-of-state-dealers-marketplace-facilitators.html), page > "An out-of-state marketplace seller is not required to register in Tennessee if all its taxable sales are made through a marketplace facilitator that is collecting and remitting Tennessee sales tax on the seller’s behalf." Tennessee Department of Revenue, [Out-of-State Dealers and Marketplace Facilitators](https://www.tn.gov/revenue/taxes/sales-and-use-tax/out-of-state-dealers-marketplace-facilitators.html), page: Marketplace Sellers > "Marketplace sellers located in TN should register for a sales tax account and file returns even if all of its sales are made through a registered marketplace facilitator." Tennessee Department of Revenue, [Marketplace Facilitators and Sellers Tax Webinar: November 26, 2024](https://www.tn.gov/content/dam/tn/revenue/documents/taxpayer_education/tax-workshop/marketplace%20webinar.pdf), Marketplace Facilitators and Sellers Tax Webinar (November 26, 2024), marketplace seller slide Sources: [Out-of-State Dealers and Marketplace Facilitators](https://www.tn.gov/revenue/taxes/sales-and-use-tax/out-of-state-dealers-marketplace-facilitators.html); [Important Notice #20-15, Marketplace Facilitators](https://www.tn.gov/content/dam/tn/revenue/documents/notices/sales/sales20-15.pdf); [Marketplace Facilitators and Sellers Tax Webinar: November 26, 2024](https://www.tn.gov/content/dam/tn/revenue/documents/taxpayer_education/tax-workshop/marketplace%20webinar.pdf). ## Tennessee's sales tax The general state sales tax rate is 7%, and a local rate set by county or city is added. Sales tax is Tennessee's principal source of state tax revenue, about 60% of collections, the Department says. > "The general state tax rate is 7%." Tennessee Department of Revenue, [Sales and Use Tax](https://www.tn.gov/revenue/taxes/sales-and-use-tax.html), page Sources: [Sales and Use Tax](https://www.tn.gov/revenue/taxes/sales-and-use-tax.html). ## Form 1099-K: Tennessee and the federal test The Hall income tax, imposed only on interest and dividends, was repealed for tax periods beginning on or after January 1, 2021, and the Department says not to file a return for those years. We found no Tennessee Form 1099-K rule; the federal test applies. > "The Hall Income tax was repealed for tax periods that begin on January 1, 2021" Tennessee Department of Revenue, [Hall Income Tax](https://www.tn.gov/revenue/taxes/hall-income-tax.html), page 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](https://www.irs.gov/businesses/understanding-your-form-1099-k), reviewed Jun 28, 2026). The [Instructions for Form 1099-K](https://www.irs.gov/instructions/i1099k) 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](https://resellerindex.com/guides/1099-k-for-resellers/). Sources: [Hall Income Tax](https://www.tn.gov/revenue/taxes/hall-income-tax.html). ## Worked examples ### State tax on a $40 marketplace sale to Nashville At the 7% state rate, a $40.00 taxable item carries $2.80 of state tax, plus the local rate for the delivery address. The facilitator collects both. ### Out-of-state seller: marketplace sales don't count An out-of-state seller sells $150,000 to Tennessee customers through facilitators that collect Tennessee tax and $20,000 from its own website in the past 12 months. Notice 20-15 says the marketplace sales do not count toward its registration test, so only the $20,000 is measured against $100,000, and it stays under unless it has a physical presence in Tennessee. ### Tennessee seller, marketplace only A seller in Knoxville sells $12,000 a year, all through registered marketplace facilitators. The Department's webinar says it should still register and file returns, reporting $0 in sales on an annual return; registration also gives it a Tennessee resale certificate for buying inventory. ### When a facilitator starts collecting A facilitator that first passes the threshold in March 2026 registers and begins collecting on June 1, 2026, the first day of the third month after the month it met the threshold, under Notice 20-15. ## Edge cases and details - Since July 1, 2024, all sales made through a facilitator's marketplace, including taxable services, are sourced to where the buyer receives the product, Notice 20-15 says; before that, taxable services followed the general service sourcing rules. - A marketplace seller that makes any sales outside a marketplace, such as through its own website or storefront, may have to register if it has a physical presence in Tennessee or $100,000 or more in Tennessee sales in the previous 12 months. - The Department's main page words the facilitator test as more than $100,000, while Notice 20-15 says $100,000 or more; the difference matters only at exactly $100,000. - Notice 20-15 says there are limited circumstances in which a facilitator is not required to report a seller's sales, and points to the Department's FAQs for them. ## What to do 1. If you are located in Tennessee, read the Department's marketplace seller guidance; its webinar recommends registering and filing even with marketplace-only sales, and registration provides a resale certificate. 2. If you are outside Tennessee, measure only your non-marketplace Tennessee sales against the $100,000 test, as Notice 20-15 describes, and check with a tax professional. 3. Keep each marketplace's Tennessee sales reports with your records. ## Common questions ### Do I need to register in Tennessee if I only sell on marketplaces? If you are outside Tennessee and all your taxable sales go through facilitators collecting Tennessee tax, the Department says you are not required to register. If you are located in Tennessee, its 2024 webinar says you should register and file returns, reporting $0 in sales on an annual return. ### Do marketplace sales count toward Tennessee's $100,000 test for sellers? No. Notice 20-15 says sales through a marketplace facilitator do not count as the seller's sales when deciding whether an out-of-state seller must register and collect. ### When did Tennessee marketplace facilitators start collecting? October 1, 2020, under Public Chapter 646 (2020). ### Does Tennessee have a 1099-K threshold? We found none. Tennessee repealed the Hall income tax, which applied only to interest and dividends, for tax periods beginning on or after January 1, 2021. The federal test applies. ## Related - [Every state on one table: sales tax, marketplace facilitator laws and 1099-K rules](https://resellerindex.com/tax/states/) - [Tennessee: seller's permit and resale certificate rules](https://resellerindex.com/tax/sellers-permit/tennessee/) - [South Dakota: sales tax and 1099-K rules](https://resellerindex.com/tax/states/south-dakota/) - [Texas: sales tax and 1099-K rules](https://resellerindex.com/tax/states/texas/) - [Form 1099-K for resellers: the federal test](https://resellerindex.com/guides/1099-k-for-resellers/) - [Do eBay's fees apply to the sales tax a buyer pays?](https://resellerindex.com/guides/ebay-fees-on-sales-tax/) - [Where each selling app keeps its sales report](https://resellerindex.com/guides/sales-reports-for-taxes/) ## General information, not tax advice This page summarizes Tennessee's own published pages and statutes as read on Oct 19, 2026, 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. - Tennessee Department of Revenue: [Out-of-State Dealers and Marketplace Facilitators](https://www.tn.gov/revenue/taxes/sales-and-use-tax/out-of-state-dealers-marketplace-facilitators.html); read Oct 19, 2026. October 1, 2020 start, more-than-$100,000 test, out-of-state marketplace sellers. - Tennessee Department of Revenue: [Important Notice #20-15, Marketplace Facilitators](https://www.tn.gov/content/dam/tn/revenue/documents/notices/sales/sales20-15.pdf); read Oct 19, 2026. Third-month start, marketplace sales excluded from seller test, sourcing since July 1, 2024, statute references. - Tennessee Department of Revenue: [Marketplace Facilitators and Sellers Tax Webinar: November 26, 2024](https://www.tn.gov/content/dam/tn/revenue/documents/taxpayer_education/tax-workshop/marketplace%20webinar.pdf), dated Nov 26, 2024; read Oct 19, 2026. Tennessee-located marketplace sellers should register and file; $0 annual return; resale certificate. - Tennessee Department of Revenue: [Sales and Use Tax](https://www.tn.gov/revenue/taxes/sales-and-use-tax.html); read Oct 19, 2026. 7% general state rate. - Tennessee Department of Revenue: [Hall Income Tax](https://www.tn.gov/revenue/taxes/hall-income-tax.html); read Oct 19, 2026. Hall income tax repealed for periods beginning January 1, 2021. - IRS: [Understanding your Form 1099-K](https://www.irs.gov/businesses/understanding-your-form-1099-k), reviewed Jun 28, 2026. The federal 1099-K test. - IRS: [Instructions for Form 1099-K](https://www.irs.gov/instructions/i1099k), reviewed Jun 1, 2026. Both parts of the federal test counted for the calendar year. Subscribe: https://resellerindex.com/subscribe/ --- The Reseller Index Researched and drafted with AI assistance from each platform's and carrier's own published pages. A full-time reseller runs The Reseller Index and will edit every newsletter issue once the newsletter starts. Every number links to its source and carries the date we checked it. Spot an error? [Tell us](https://resellerindex.com/corrections/) and we'll fix it in the public corrections log. General information, not tax, legal or financial advice. Not affiliated with or endorsed by eBay, Amazon, Mercari, Poshmark, Depop, Whatnot, Etsy, TikTok Shop, USPS, the IRS or the software companies whose prices we track; their names belong to them. Each page shows the date its own rates were last checked. 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