FBA prep in the 5 sales-tax-free states costs 58% more at entry.
New Hampshire, Oregon, Delaware, Montana, and Alaska charge no statewide sales tax, which is the reason sellers go looking for prep centers there. The published rate cards point the other way: median entry prep in those five states is $1.50 per unit against $0.95 in the rest of the US, a 58% premium in our 2026 Pricing Index (2026-06-12 snapshot).
So the tax you avoid has to beat the rate premium, and on the prep invoice alone it does not. Here is the arithmetic, and the two situations where a tax-free state is still the right call.
Does the avoided tax clear the rate premium?
An operator will never publish this, because no operator can publish a price above its own. We can. Across the deduped US pool in the 2026 Pricing Index, entry pricing splits like this: $1.50 per unit in the tax-free states, $0.95 everywhere else, national median $1.30. The premium you pay for the tax-free address is $0.55 per unit.
That sets up an arithmetic question with a cleaner answer than most cost comparisons get. The premium scales with units. The sales tax you would have paid on a prep invoice elsewhere also scales with units. Divide one by the other and volume cancels out entirely.
r* = (tax-free entry median - other-state entry median) / other-state entry median
r* = ($1.50 - $0.95) / $0.95 = 57.9%
A tax-free prep center pays for itself on the prep invoice only where prep services are taxed at 57.9% or more. That is the same figure the Index publishes as the 58% premium, which is not a coincidence: the break-even rate and the premium are the same ratio.
No US sales tax comes close to that rate. For scale, the highest state-level sales tax rates in the country sit here:
- 6.25%Texas, state rate, before local add-ons of up to 2%
- 7%Tennessee, tied for the highest general state rate with IN, MS and RI
- 7.25%California, the highest statewide rate in the country, with district rates on top
Worked at 500 and 2,000 units a month
Both rows use 7.25%, the highest statewide base rate of the three above, and assume the most favorable case for the tax-free side: that prep services are fully taxable in the comparison state. Even then it does not close.
| Monthly units | Tax-free invoice | Other-state invoice | Rate premium | Tax avoided at 7.25% | Net per month |
|---|---|---|---|---|---|
| 500 | $750.00 | $475.00 | $275.00 | $34.44 | $240.56 worse |
| 2,000 | $3,000.00 | $1,900.00 | $1,100.00 | $137.75 | $962.25 worse |
Scaling up does not rescue it. Both columns are linear in units, so a 10,000-unit month multiplies the same gap rather than closing it.
Three caveats, and each matters more than the arithmetic.
We are not tax advisers, and prep may not be taxable at all. Whether a prep or fulfillment service is subject to sales tax varies by state and often by how the invoice is itemized. Plenty of states do not tax labor-only services. Where that is true the avoided tax is zero, and the premium is the entire story.
These are entry rates. Entry pricing is what a center charges before volume tiers kick in. The Pricing Index reports volume-tier medians separately. Read those rather than assuming this gap holds at your tier.
Medians describe the pool, not your quote. A specific Montana center can undercut a specific Ohio center. The premium is a property of where operators cluster, not a prediction about the two centers you are comparing. Many centers also charge a one-time setup fee that lands hardest on small monthly runs; the Index publishes that distribution too.
What a tax-free state is actually worth
The defensible reason to prep in one of these five states is not the prep invoice. It is the inventory. As a general rule sales tax is charged where a purchase takes place, so a seller sourcing at retail inside New Hampshire, Oregon, Montana, or Delaware is not taxed at the register on the goods themselves.
That is a percentage of cost of goods rather than a percentage of one line item on a service invoice, and cost of goods is the bigger number by an order of magnitude. It is why online and retail arbitrage sellers, not private-label sellers, are the ones who keep showing up in these states, and why Montana in particular is where sourcing and prep capacity overlap.
The usual qualifications apply and they are not small. Use tax can apply in your home state on goods you bring back. Nexus and marketplace facilitator obligations are destination-state questions that your prep address does not answer. None of this is tax advice; take the sourcing argument to a CPA before you build a supply chain on it.
Tell us your volume and we will show you whether a tax-free center pencils out.
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Run my volume through it →What "tax-free" covers here, and what it does not.
Five states levy no statewide sales tax: New Hampshire, Oregon, Delaware, Montana, and Alaska. That is a fact about the state, not a claim about any center inside it, and it is the only thing the phrase guarantees.
Alaska is the asterisk. There is no state sales tax, but Alaskan municipalities can and do levy local sales taxes, so the tax-free label is not uniform inside the state. Check the specific borough or city, not the state.
Delaware is the other asterisk. It levies a gross receipts tax on businesses rather than a sales tax. You will not see it as a line item on your invoice, but it is a cost the operator carries and prices into the rate.
These five are where pure-prep specialists concentrate. We currently list 71 verified centers across them, 43 of those in Montana alone. The clustering is not a coincidence and it is not about the prep invoice: it tracks where arbitrage sellers already buy inventory. Montana is the clearest example, which is also why its published rates are not the bargain the state's reputation implies.
Counts below are live and come from the same verification state the profile badges use, so a flagged center never counts as verified. For the complete typed list of every center we publish, tax-free or not, use the full prep center directory.
The 5 tax-free states, compared.
Counts reflect prep centers in our directory that cleared our 4-point operator standard. Dashes mean we don't have data yet, never a guess. The hazmat column counts centers that state they take hazmat; the rest either state they do not or have no answer on record yet.
The nexus argument, explained.
Amazon FBA sellers normally trigger sales-tax physical nexus in any state where their inventory is stored. In a state with sales tax, that nexus typically means the seller (or, under marketplace facilitator laws, Amazon) has to collect and remit sales tax on transactions delivered into that state.
New Hampshire, Oregon, Montana, Delaware, and Alaska are the five US states with no statewide sales tax. Storing inventory in any of them creates no sales-tax nexus in that state, because there is no sales tax for nexus to attach to. That's the entire mechanic, and the entire pitch.
Two caveats worth being honest about: (1) nexus rules vary by destination state. Storing in Oregon does not exempt you from collecting tax in states where you have other physical or economic nexus. (2) Amazon's actual FBA fulfillment centers are not necessarily in tax-free states . Once your inventory leaves the prep center for an FC, it may land in a state that does have sales tax, which can recreate the nexus exposure the prep-step was meant to avoid.
This is orientation, not tax advice. Confirm any inventory or nexus strategy with a CPA who understands marketplace facilitator law.
Who a tax-free state is right for.
Both lists assume you have read the break-even arithmetic above. The premium is real; the question is what you are buying with it.
- You source at retail inside a tax-free state. The saving is on your cost of goods at the register, and the prep center sitting next to your sourcing is a logistics convenience on top of it.
- You already operate in one of the five states for reasons that have nothing to do with Amazon.
- Your primary FC cluster genuinely is closest to Portland, Wilmington, or Manchester. Transit days beat rate lines on almost every P&L.
- You are buying depth rather than price. Montana carries the deepest verified bench in our directory, and most of its operators publish a per-unit rate card you can read before you call.
- You picked the state to cut sales tax on the prep invoice itself. The arithmetic above says that does not work at any volume.
- You ship into FCs on the other coast. The added transit days and freight cost more than the per-unit line you are optimizing.
- You expect a tax-free state to solve nexus. It removes nexus in that one state, and your inventory leaves for an FC somewhere else within days.
- You are price-shopping at low volume. Entry rates in these five states are the highest in our index, and a one-time setup fee lands hardest on small monthly runs.
Oregon
- Salem
- Portland, Eugene
- 4.3M
- 13
- Closest tax-free state to West Coast Amazon FCs
Oregon is the default tax-free pick for sellers shipping into Amazon's West Coast network. Portland sits roughly 3 hours from the SEA and ONT clusters, which keeps inbound transit times competitive even after the prep-center detour. Sellers using Oregon prep centers commonly cite proximity to FBA over pure tax math.
Prep centers in Oregon
View all Oregon centers →Oregon Prep Center
Oregon Prep Center is an FBA prep center in Portland, Oregon, operating since 2023 and under new ownership since June 2026: the Oregon Secretary of State shows Oregon Prep Center Group, LLC organized on June 11, 2026 at the Gladstone Street facility, and the site names Stephanie and Caleb as owners. The owners say a warehouse manager and a floor team run day-to-day prep. Standard per-unit prep runs $1.70/unit (1-200 units) down to $1.05/unit (2,000+), with wholesale as low as $0.40/unit, free FNSKU labeling, free standard polybags, no monthly fees, and 7 days of free storage. Stated turnaround is 24 to 72 business hours, processing 7 days a week, with a client portal for real-time inventory and multi-carrier shipment tracking. Carries a 4.7 Google rating and a BBB A+ profile.
HexPrep
HexPrep runs two FBA-prep and fulfillment warehouses, one in Oregon (tax-free) and one in Illinois (Chicago). Published rates on a page dated April 24, 2026: OA FBA and WFS prep at $1.50/unit (0-999/mo) or $1.25/unit (1,000+/mo), wholesale and private label at $1.00/$0.70, plus an itemized add-on and box menu. The homepage claims 99% accuracy and 100+ active clients, and the operator states a standard 1-2 day receiving-to-outbound turnaround (confirmed by email, September 2026). Note the catch: outbound shipments under 20 units carry a $5.00 handling surcharge unless you are a recurring client, and packaging is billed separately. Beyond Amazon and Walmart prep, HexPrep also sells FBM/DTC fulfillment and two-step dropshipping.
Network Prep
Network Prep is an Amazon FBA prep center in sales-tax-free Lafayette, Oregon, founded in late 2019 by Chaz and Trista Leslie of the Side Hustle Network YouTube channel. They run a 5,000 sq ft facility on a fixed weekly shipment schedule with a 1 business day turnaround. Base prep runs $1.00 to $1.65 per unit by monthly volume with polybags, bubble wrap, and shipping boxes included; they also handle hazmat, oversize, and merchant-fulfillment orders for Amazon and Walmart sellers. As of June 2026 the center runs an application-based intake with limited spots (the earlier waitlist-only status has lifted); the operator reviews every application and replies within 1-2 business days.
Prep Ninjas
Family-owned Oregon FBA prep center run by the Rasmussen family, in business since February 2018 out of a 4,000 square foot warehouse with three employees. Per-unit pricing is public: $2.25/unit for 0 to 299 units/month and $1.45/unit for 300 to 9,999 units/month, with itemized add-ons. Most orders are checked in within 24 to 72 business hours, longer during Prime Day and Q4. They explicitly do not process customer returns or FBA removals and do not accept used books.
Delaware
- Dover
- Wilmington, New Castle
- 1.0M
- 9
- East Coast hub, 90 min from Philly FC
Delaware is the East Coast counterpart to Oregon: small, no sales tax, and a short drive from Amazon's PHL and EWR clusters. Wilmington's port access also makes it a common landing point for inbound containers headed to FBA, which is why several import-heavy prep centers cluster there.
Prep centers in Delaware
View all Delaware centers →A Featured (paid) center is shown first and labeled on its card. Paying never changes verification.
Urva Prep Center
Urva Prep Center is a multi-service Amazon FBA and Walmart WFS prep operation in tax-free Newark, Delaware, running a primary 25,000 sq ft facility at 301 Ruthar Drive plus a 10,000 sq ft site in Bear. FBA and WFS prep is the productized core, with wholesale prep from $1.00 down to $0.55/unit by volume and online-arbitrage prep from $1.50 down to $1.00/unit. Alongside prep it offers FBM and DTC order fulfillment (same-day before the 7am EST cutoff), two-step dropshipping, FTL inbound consolidation at $0.20 to $0.50/lb, shrink-wrap, and a software dashboard. Storage is free for 14 days then $0.02/unit/day. Hazmat is accepted. Because it runs fulfillment alongside prep, confirm scope directly if you want a prep-only relationship.
Dollan Prep Center
Dollan Prep Center is a tax-free Delaware FBA prep center at 210 Executive Dr in Newark, serving wholesale, private-label, and online-arbitrage Amazon sellers. Labeling runs from $0.30/unit at high volume up to $1.10 to $1.45/unit at standard volume, with most shipments checked in within 24 to 72 hours and billing settled weekly via Stripe. Onboarding is currently limited to sellers moving at least 400 units per month. Alongside FBA prep it also offers FBM fulfillment, Walmart WFS prep, eBay fulfillment, an FTL inbound-freight program, and storage, so confirm scope if you want a prep-only relationship.
QuickShipment
QuickShipment is an Amazon FBA prep center in Claymont, Delaware, run by SECA Group LLC, a Delaware company formed in June 2023, from unit D11 of the Tri-State Industrial Center at 950 Ridge Road. Its prep scope is spelled out per unit: cartons are counted against the packing list and photographed, units are inspected, old barcodes are covered and FNSKU labels applied, fragile items get bubble wrap, poly bags carry suffocation warnings, sets are bagged as one unit, and cartons are weighed, labeled and built into a shipment plan in Seller Central. The published card runs from $2.00 a unit under 100 units a month to $1.25 at 500 to 999 and $0.69 at 5,000 or more, with FNSKU labels included. Poly bagging adds $0.75 a unit, bubble wrap and bundles $0.90, pallet receiving is $35, and pallet storage runs $2 to $5 per pallet per day. Stated turnaround is 48 hours from receipt, with no minimums or setup fee. It says many clients ship from abroad, and it also offers FBM fulfillment, returns processing, product photography and a US mailing address. Cautions: the homepage testimonials and savings figures cannot be verified, and the company's own About page says its case studies are composites. Its seller counts and review scores are its own figures, and photos of the warehouse floor are not yet published. The industrial park's units run 720 to 4,500 square feet, so confirm capacity before sending large volumes.
Delaware Prep & Fulfillment Center
Newark, Delaware prep center for Amazon FBA, FBM, and arbitrage sellers. Located in a tax-free state for inventory storage. Services include receiving, inspection, labeling, bundling, storage, forwarding, and FBA returns processing. Eligibility minimum: 1,000 items per month for account activation. The operator claims membership in Amazon's Service Provider Network (SPN); verify this independently before relying on it as a credibility signal.
New Hampshire
- Concord
- Manchester, Nashua
- 1.4M
- 6
- Closest tax-free state to Boston metro
New Hampshire is the standard tax-free option for sellers serving the Boston metro and broader New England demand. Manchester and Nashua sit a short drive from the Massachusetts FC cluster (BOS / BWI feeders), and the state has no individual income tax on earned wages either, a secondary draw for operators who relocate.
Prep centers in New Hampshire
View all New Hampshire centers →Live Free or Die Distribution
Live Free or Die Distribution is a family-run Amazon FBA prep center at 115 Highland Street in Rochester, NH, a sales-tax-free state. The LLC has been registered with the NH Secretary of State since January 2025, is in good standing with its 2026 annual report filed, and owner Andrew Tompson is confirmed by the registry. The per-unit FBA card is public: $1.75 per unit at base volume down to $1.00 at 3,000+ units a month, with a $249 start-up fee, a $99 flat monthly fee below 300 units, and a 3% payment-processing fee on invoices. The center requires sellers to have at least 1 year of active Amazon selling history. We found no third-party reviews anywhere yet; the on-site testimonials are specific and internally consistent but self-hosted, so treat service quality as unvouched and test responsiveness first.
Heroic Prep
Merrimack, New Hampshire prep center serving Amazon FBA sellers. Located in the tax-free state of New Hampshire; the operator says this lets clients pay no sales tax on incoming products. Per-unit pricing steps from $1.75/unit at 1000 units/month to $1.50 at 2000 and $1.25 at 4000, as the card prints those volumes. Eligibility minimum: 1,000 units/month and at least one year of Amazon selling history. All-inclusive packages cover inspection, FNSKU labeling, heat-sealed polybagging, suffocation-warning labels, dunnage, expiration labels, damage handling, outbound boxes, and 14 days of inventory storage. Client eligibility (per the operator's FAQ, September 2026): sellers primarily in grocery, toys or shoes are not accepted, Inventory Lab is required, and limited-permission Seller Central access is needed. Hazmat: the operator's pages conflict. The FAQ says hazmat shipping is paid through its discounted UPS account and added to the client's invoice, while the How It Works page says hazmat shipping is offered at no additional cost, so confirm the charge before sending hazmat. No long-term storage; no charge until prepping begins. Products fitting three or fewer in a 24x21x20 box, and all shoes, are charged as a bundle.
United States Prep
United States Prep is an Amazon FBA prep center in tax-free Salem, New Hampshire, built for online and retail arbitrage sellers moving consistent volume. Standard prep runs $1.50 per unit with $0.50 add-ons for liquid sealing, bubble wrap, and bundling. Turnaround is 2 to 4 days standard, with a 24 to 48 hour priority option. Services cover receiving, inspection, FNSKU labeling, polybagging, and packaging to Amazon standards.
Prepare Less
Prepare Less is a prep service in Hampton, New Hampshire, a sales-tax-free state, registered with the NH Secretary of State as Prepare Less LLC since July 2023 and in good standing with its 2026 annual report filed. The homepage leads with all-inclusive per-unit prep pricing: $1.40 per unit up to 500 units a month, $1.20 to 1,000, negotiable above that, covering FNSKU labeling, polybagging, set creation, bundling, and palletization, with FBM fulfillment and storage as secondary services. This listing carries a warning: the two-page website has been unchanged since April 2024, publishes no street address or phone (the address here comes from the state registry), and we found no third-party reviews anywhere. The entity is demonstrably active even though the site is static; treat responsiveness as the thing to test first.
Montana
- Helena
- Billings, Missoula
- 1.1M
- 43
- Lowest-cost option, but distant from FCs
Montana is the cheapest of the five on warehouse rent and labor, but the closest large Amazon FC is in Salt Lake City or Spokane, meaning inbound legs add 1-2 days of transit. Best suited to slow-moving SKUs, oversize items, or long-term storage where the cost-per-square-foot win outweighs transit drag.
Montana is the largest single-state cluster in our directory, and nearly every operator in it publishes a per-unit price sheet. The state guide ranks every Montana operator we list, each labeled with its type, and compares each published rate card side by side: entry rate, best volume rate, setup fee, and storage terms.
Montana prep centers ranked, with every published rate card →Prep centers in Montana
View all Montana centers →Southwestern Montana Prep and Pack
Southwestern Montana Prep and Pack is a small Amazon FBA prep shop in Fromberg, Montana, a state with no sales tax, run by Southwestern Montana Prep and Pack LLC, a Montana company on the state register since 2023. It works with wholesale, private label and arbitrage sellers on small to medium shipments. Cartons are received and inspected, damage is photographed and emailed, old labels come off, and units get FNSKU, fragile, suffocation, single-unit or do-not-open labels, poly bags, bubble wrap or bundling before cartons are boxed and shipped on a shipment plan built by the seller or by the shop. The published card runs $1.10 a unit for up to 1,000 units a month, then $1.00, $0.90 and $0.75 at 8,001 or more, with a $25 registration fee. Bundles start at $1.75 for two units, poly bags at $0.20, and it will unbox retail sets for resale as singles for $3.00 to $5.00. It also preps shoes. Stated turnaround is 24 to 72 hours. Cautions: the only contact is a Gmail address, with no phone number and no street address on the site, and the footer reads 2020 although the company and its domain date from 2023.
Cloud Peak Prep and Ship
Cloud Peak Prep and Ship describes itself as a family-owned Amazon FBA prep shop in Billings, Montana, a state with no sales tax, run by Cloud Peak Prep and Ship LLC, a Montana company filed in May 2022. Its site lays out a single prep workflow: cartons are unboxed and counted against your packing slips, damage is photographed and emailed, price tags are removed or covered, and units get FNSKU, suffocation and do-not-separate labels, poly bags, bubble wrap or bundling before cartons are boxed, labeled and shipped on a shipment plan built by you or by them. Pricing is published per unit by monthly volume, from $1.00 for up to 1,000 units down to $0.60 above 10,000, with labeling and inspection included. Bundles of two run $1.75 with the bag, poly bags $0.20 to $1.00, and storage is free for 14 days, then $15 a bin or $35 a pallet per month. Stated turnaround is 24 to 72 business hours, plus a day in October through December. FBM and eBay orders are $3.00 a unit; the site says to ask about availability. Cautions: the homepage card carries a $100 minimum monthly bill, but the site's separate Prices page still shows an older card with no minimum and lower box prices, so confirm terms in writing. PayPal is the only payment method. Contact is a Gmail address and a Wyoming-area-code phone, the site gives no street address, and its footer still reads 2022.
Montana Ship Smart
Montana Ship Smart is a home-based Amazon prep and ship shop in Belt, Montana, a state with no sales tax, run by Montana Ship Smart LLC, registered in June 2025. Its site says incoming cartons are counted and checked for damage, with photos sent when there is a problem and quantities logged in a spreadsheet shared with the seller, and that units are labeled to Amazon's guidelines with FNSKU and fragile, suffocation or single-unit warnings, then bagged or bundled and boxed for Amazon. It also lists FBM, Walmart WFS, TikTok Shop, eBay and dropship orders. Cautions, stated plainly. The price list on the site matches another Montana prep center's published card line for line, with every dollar figure the same and in the same order, and its service description closely follows that center's wording, so we do not show those numbers as Montana Ship Smart's rates; get a written quote before you ship. Its posted terms, which match the same card, add a 5% late fee on invoices unpaid after 48 hours that doubles every 48 hours. The operation runs from a residence, the business is about 16 months old, no archived copy of its site exists, and the site has only two pages.
Montana Prep Solutions
Montana Prep Solutions is an Amazon FBA prep center in Helena, Montana, a tax-free state, handling small to medium shipments for wholesale, private label, retail arbitrage, and online arbitrage sellers. Per-unit pricing runs $0.85 to $1.49 by monthly volume and covers receiving, inspection, label removal, FNSKU and warning labeling, and the first 14 days of storage. There are no setup or monthly fees and no minimum order quantity. Turnaround is stated at 24 to 72 hours; the center does not accept pallets or semi-truck loads, and new accounts are gated (the operator evaluates each request before onboarding). Contact is via the site form.
Alaska
- Juneau
- Anchorage
- 0.7M
- 0
- Niche; only relevant for AK-resident sellers
Alaska is the most niche of the five. Logistics costs from Anchorage into the lower 48 typically erase any tax-nexus advantage for sellers shipping to mainland FBA destinations. It shows up here mainly for Alaska-resident sellers and for businesses where the owner is already operating in-state for non-Amazon reasons.
Prep centers in Alaska
We haven't verified a prep center in Alaska yet. Know one? Submit it →
Common tax-free state questions.
Direct answers, written for sellers, not tax attorneys. None of this is tax advice. Confirm specifics with your CPA.
Does a prep center in a tax-free state save me money on prep?
Not on the prep invoice. In the 2026 Pricing Index, median entry pricing in the five tax-free states is $1.50 per unit against $0.95 in the rest of the US, a 58% premium. Both the premium and any avoided sales tax scale with units, so volume does not change the answer: the premium is worth paying only where prep services are taxed at about 57.9%, and no US jurisdiction is close. The real case for these states is inventory sourcing, not the prep line item.
Are tax-free state prep centers more expensive than other states?
Yes, at entry pricing. Our deduped 2026 Pricing Index puts median entry at $1.50 per unit in the tax-free states against $0.95 elsewhere in the US, a 58% premium, with the national median at $1.30. Medians describe the pool, not any one quote: a specific Montana center can undercut a specific Ohio center. Compare published rate cards directly rather than assuming a state is cheap.
Which tax-free state has the most verified prep centers?
Montana, and not by a little: 43 of the 71 verified centers we list across the five states. Then Oregon (13), Delaware (9), New Hampshire (6). We currently verify no prep center in Alaska. The per-state table above carries the live count, and it moves as the directory does.
Will using a prep center in a tax-free state save me money on sales tax?
Only in narrow ways, and not the way most sellers expect. Storing inventory in a state with no sales tax creates no sales-tax nexus there, but you still owe tax wherever else you have physical or economic nexus, including the states Amazon moves your inventory to after prep, and marketplace facilitator laws shift collection on most marketplace sales to Amazon anyway. The clearer saving is on the buy side: as a general rule sales tax is charged where the purchase happens, so goods bought at retail inside a tax-free state are not taxed at the register. Use tax can still apply in your home state. Confirm both with your CPA.
Does storing FBA inventory in Oregon create sales tax nexus in Oregon?
No. Oregon has no statewide sales tax, so there is no Oregon sales tax to collect or remit, regardless of inventory location. Storing inventory in Oregon also does not by itself create nexus in any other state. Nexus is determined by each destination state's rules on physical and economic presence. Confirm with your CPA before relying on this for tax planning.
Is Delaware better than New Hampshire for FBA prep?
It depends on which Amazon FC cluster you ship into. Delaware is closer to PHL and EWR; New Hampshire is closer to the Boston-area FCs. Both states have no sales tax. Cost and capacity vary by individual center, not by state. Pick the state nearest your primary inbound destination and compare specific centers within it. Confirm transit assumptions with the prep center before committing.
Does Amazon have FBA warehouses in Montana or Alaska?
No. Amazon operates no FBA fulfillment centers in Montana or Alaska. Inventory prepped in either state must be shipped to an Amazon FC elsewhere (often Salt Lake City or Spokane from Montana; the lower-48 generally from Alaska). The prep-center step happens in-state; the FBA storage step does not. Confirm current FC network coverage on Amazon's seller documentation.
Do I need to register my LLC in the tax-free state where my prep center is located?
Usually no. Using a third-party prep center does not by itself require you to register an LLC in that state. Foreign-qualification rules vary by state and are triggered by activities like leasing your own space, having employees, or making in-person sales. Using a 3PL or prep center is typically not enough. Confirm with a business attorney or CPA for your specific situation.
How does economic nexus work in tax-free states?
Economic nexus is irrelevant in the five tax-free states because there is no sales tax to trigger. Economic nexus thresholds (typically $100K in sales or 200 transactions) apply in the 45 states with sales tax and are evaluated per-destination-state, not based on where your inventory sits. Storing in a tax-free state does not exempt you from economic nexus elsewhere. Confirm with your CPA.
Can I use multiple prep centers across different tax-free states?
Yes. There is no rule against splitting inventory across multiple prep centers in different states. Sellers commonly run one West Coast prep (often Oregon) and one East Coast prep (Delaware or New Hampshire) for transit-time reasons. Coordinating SKU allocation, FNSKU labeling, and inbound paperwork across centers adds operational overhead. Plan for it before committing.
We are not tax advisors. Sales tax nexus rules are complex and vary by destination state, and whether a prep service is taxable at all is a separate question that varies by state and by how the invoice is itemized. The break-even arithmetic on this page is an illustration built from published rate cards and statutory state rates, not a calculation of your liability. Information here is for orientation only. Confirm with your CPA before making decisions about inventory storage locations.
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