Taxpayer Doesn’t Meet Definition of Marketplace Facilitator in North Carolina

A North Carolina taxpayer who is an affiliate of original equipment manufacturers (OEMs) does not meet the definition of a “marketplace facilitator” per a private letter ruling from the North Carolina Department of Revenue. The taxpayer owns and administers the electronic infrastructure of a platform on which marketplace sellers make sales.

North Carolina defines “marketplace facilitator” as a person that, directly or indirectly and whether through one or more affiliates, does both of the following:

• • • Lists or otherwise makes available for sale a marketplace seller’s items through a marketplace owned or operated by the marketplace facilitator; and
    • Collects the sales price or purchase price of a marketplace seller’s items or otherwise processes payment, or makes payment processing services available to purchasers for the sale of a marketplace seller’s items

Based on the information provided, the taxpayer is not a marketplace facilitator since it does not meet both parts of the state’s definition. While the taxpayer does own and administer a marketplace in North Carolina that lists marketplace sellers’ items for sale, the taxpayer does not directly or indirectly collect the sales price or purchase price of the marketplace sellers’ items, process payment, or make payment processing services available. Third-party providers who are not affiliates of the taxpayer process payment and make payment processing services available. As such, the taxpayer does not meet the state’s definition of a marketplace facilitator.

(SUPLR 2022-0008, North Carolina Department of Revenue, December 9, 2022)