Likewise, by obligating the marketplace facilitators, state tax authorities have a narrower set of financially viable targets to hold responsible in case of noncompliance. So that marketplace facilitators are not functionally made guarantors of marketplace sellers’ sales tax liabilities, many of these new laws include a safe harbor for marketplace facilitators when an error is made due to reasonable reliance on information provided by the marketplace seller or the purchaser (e.g., the marketplace seller lies, makes a mistake, or fails to disclose information necessary to allow the marketplace facilitators to properly report and pay sales tax owed). In that case, liability attaches to the marketplace seller. Marketplace facilitators are also generally made subject to state taxing authority audits.
The marketplace facilitator is paid for the service, usually through fees. Most of these bills and laws exclude websites that merely advertise goods for sale and that do not handle transactions (or otherwise engage in “nexus producing activities”). Likewise, mere payment processors generally do not qualify.