Linkshare/DMA – Join the New York Tax Conference Call PLUS DMA’s Analysis of the Law
Complete Coverage of the New York Affiliate Tax Issues Here
I just got this info about action the Linkshare Affiliate Network is taking in conjunction with the DMA to address the New Your Tax law problem. Linkshare and the DMA will be having a conference call on the issue this Thursday, 5/22 at 11 AM EST. All interested parties should try to be on the call!
UPDATE: 12 PM I’m registered for the conference call. A few of us should try to put our heads together to come up with the 1 or 2 most important questions, since Q&A time may be limited and who knows how many people will have questions. We should nominate a spokesperson to ask the Qs so we are organized. (See comments for more info on this.)
BE SURE to read the DMA’s legal analysis thus far about the law, which raises the issue about affiliates creating a nexus in the state. I’ve included a link to the PDF after the quote. Linkshare wrote:
“Dear Partners,
On April 9, 2008, New York State passed a law mandating that any retailer that (1) meets a certain sales volume from sales to New York customers and (2) has an affiliate program with New York based publishers that refer customers to the retailer and are paid on a commission basis must charge and collect New York sales tax on all sales shipped to New York.
We have been actively working with, and providing support to, the Direct Marketing Association (DMA) to clarify this law. The Direct Marketing Association is the leading global trade association for businesses that use direct marketing tools and techniques. LinkShare is proud to be their partner. As this issue continues to develop, we are committed to making available the insights of authoritative partners like the DMA to help inform and guide you.
To this end, we are pleased to invite you to be LinkShare’s guest for the DMA’s conference call on this issue, featuring DMA Tax Counsel George Isaacson this Thursday, May 22, 11AM to 12Noon Eastern. He will provide an overview of the bill and the DMA’s interpretation of it. There will also be an opportunity for Q&A.
To join the call (Thursday, May 22, 11AM to 12Noon Eastern), email:
government AT the-dma.org to receive personalized dial in information. Please let them know you are a member of the LinkShare Network.Of course, while the DMA is an authoritative source for information, since every business has a unique situation, we urge all our partners to seek out individual independent tax and legal advice. As background for this call, you will find the recent New York Department of Taxation and Revenue Technical Service Bulletin (TSB) and DMA’s analysis of it on our site at
http://www.linkshare.com/advertisers/ny_state_tax/.”
Direct Marketing Association (DMA) Analysis of the New York Tax Law!!! Important info about whether affiliates meet the requirements of a tax nexus.
UPDATE: 5/20 12PM Another major Internet Marketing Organization had a meeting about this today. Waiting to hear results. Will blog it or add to an existing blog, depending on what I hear and where the info best fits.
For supporting background info, here is the actual New York Department of Taxation and Revenue‘s Technical Service Bulletin
NOTE: Shareasale has been active in this fight, offering valuable advice and even created a special report to help merchants deal with this issue. Linkshare is taking a big initiative with the actions above.
By contrast CJ is not taking any kind of active stance, publicly at this point anyway. Here is the VERY vanilla, non-stance email I just got from CJ, which merely acknowledges the issue and gives a link to check it out.
“As you may already know, the State of New York recently enacted new legislation that addresses tax registration, collection, and other time-sensitive obligations. As with all laws, this law may or may not apply to you and your business. We are actively monitoring the law and will use reasonable efforts to protect ourselves and our publishers as we deem appropriate.
The application of the law is dependent on particular business and factual circumstances, and Commission Junction is not in a position to provide legal and tax advice regarding this law. However, we encourage you to perform the appropriate due diligence as it relates to your business.
For your convenience, we have provided a link to a memo from the New York State Department of Taxation and Finance, Office of Tax Policy Analysis, Taxpayer Guidance Division that addresses the new legislation:
http://www.tax.state.ny.us/pdf/memos/sales/m08_3s.pdf”
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#1 Linda Buquet wrote on Tuesday, May 20th, 2008:
I’m registered for the conference call. A few of us should try to put our heads together to come up with the 1 or 2 most important questions. Q&A time may be limited and who knows how many people will have questions. Instead of several of us scrambling to get a Q in, that may not be the most important, we should nominate a spokesperson to ask the Qs so we are organized.
We need someone with some industry recognition who is succinct, not emotional and can just stick to the facts. I nominate Shawn!
#2 Commission Junction / Direct Marketing Association response on NY Sales Tax : Vastplanet Blog - Internet Marketing wrote on Tuesday, May 20th, 2008:
[...] Linkshare/DMA – Join the New York Tax Conference Call PLUS DMA’s Analysis of the Law by Linda Buquet of 5Star Affilaite [...]
#3 Linda Buquet wrote on Tuesday, May 20th, 2008:
Added this update to blog, but wanted to be sure everyone sees it.
UPDATE: 5/20 12PM Another major Internet Marketing Organization had a meeting about this today. Waiting to hear results. Will blog it or add to an existing blog, depending on what I hear and where the info best fits.
#4 Linda Buquet wrote on Tuesday, May 20th, 2008:
ODD? Both docs are missing from the Linkshare Page they are sending people to.
http://www.linkshare.com/advertisers/ny_state_tax/
Both PDFs were there earlier today several times when I checked.
NEVERMIND as of Wed AM they are back.
#5 Jason Forthofer wrote on Tuesday, May 20th, 2008:
Another angle on this law. It’s actually the network that pays the affiliate (in most cases). It’s the network, not the merchant that sends the W-2. Can this new law only apply to the affiliate networks based in New York, like Linkshare?
#6 Linda Buquet wrote on Tuesday, May 20th, 2008:
Thanks Jason, I wondered that too. But they covered their bases on that one on page 3, example 3. http://www.tax.state.ny.us/pdf/memos/sales/m08_3s.pdf
“T sells a variety of small tools nationwide, over the Internet. T’s home office is in Arkansas, where its warehouse and administrative offices are located.
T enters into a contract with S, a service provider. Under the contract, S enters into agreements with New York State residents on behalf of T, whereby the New York State residents agree to refer potential customers to T’s Web site in order to purchase T’s products by placing T’s product links on their Web sites.
Under the contract, S tracks sales of T’s products as a result of the referrals from the New York State residents’ Web sites. S distributes commissions to the New York State resident representatives based on these sales from an account maintained by S on behalf of T for this purpose.
From March 1, 2007, to February 29, 2008 (i.e., the preceding four quarterly sales tax periods), T’s gross receipts from sales made under its agreements with S and the New York State residents as described above totaled $68,000. Therefore, T is presumed to be soliciting sales in New York State through the use of independent contractors or other representatives and required to be registered as a sales tax vendor, collect New York State and local sales taxes, and file the required sales tax returns.”
#7 Merchants - URGENT Re New York Affiliate Tax Law - 5 Star Affiliate Marketing Blogs wrote on Tuesday, May 20th, 2008:
[...] is extremely urgent information for all merchants – please spread the word! I just got off the Linkshare/DMA New York Tax conference call with DMA Tax Counsel George Isaacson. George stressed upfront that this was not strategy call – [...]