From Cart to Compliance: Tax Tips Every E-Commerce Founder Needs to Know
- Jasmine Mitchell
- Mar 24
- 3 min read
Let’s be real—taxes weren’t the reason you started your business. But if you're running an online store and trying to grow something sustainable, then understanding the tax side is non-negotiable. In our recent “From Cart to Compliance” webinar, we sat down with Christine Harrison, founder of Accounting Specialties and Tax Solutions and a federally licensed enrolled agent (translation: a tax pro who can represent you in all 50 states). She broke down exactly what e-commerce sellers need to know to protect their profits and stay out of trouble.
Here are the top takeaways to help you master your money and your mindset around taxes:
1. E-Commerce Taxes Are Different—And More Complex
Christine shared that online businesses face three layers of tax:
Income Tax (yes, even your “side hustle” counts)
Sales Tax (and it might not be just your state)
Self-Employment Tax (that’s 15.3% for Social Security and Medicare alone)
If you’re selling across platforms like Shopify, Etsy, or Amazon, you're potentially responsible for collecting and paying sales tax in multiple states, depending on where your customers live or where your inventory is stored. That’s called sales tax nexus, and it’s something most e-commerce founders learn about the hard way.
Real talk: One of Christine’s clients ignored this, and ended up owing thousands in back taxes to another state. Don’t let that be you.
2. Sales Tax Isn’t Yours to Keep
This one is important. Christine reminded us that sales tax is a trust account. When you collect it, you’re holding that money for your state’s Department of Revenue—not your business. Failing to remit it properly? That’s where the big penalties come in.
Her advice:
3. Deductions Are Your Best Friend (If You Track Them)
Too many founders miss out on legit deductions like:
Packaging and shipping costs
Software like Shopify, Klaviyo, or Canva
Paid ads and influencer collaborations
Your home office (if you’re profitable)
Christine shared that keeping clean records year-round is the secret to maximizing these write-offs. That means:
A dedicated business bank account
Scanning receipts (paper fades!)
Using tools like QuickBooks or Wave to keep things organized
Pro Tip: Don't wait until tax season. Monthly or quarterly bookkeeping is less stressful and way more affordable.
4. Common Mistakes That Can Cost You
Christine gave us a checklist of what not to do:
Ignoring 1099-K forms (they’re real, and the IRS gets them too)
Mixing personal and business finances (opens the door to audits)
Not setting money aside for taxes (she recommends 25–30%)
Filing late or skipping returns (increases audit risk)
If you're not sure what you're doing, hire help or take a class. And no, your cousin's "Netflix is a business expense" advice doesn't count.
5. This Isn’t Just About Your Business—It’s About You
One of Christine’s most important reminders?
“Your business doesn’t pay taxes. You do.”
Most e-commerce founders are filing as sole proprietors, which means your business income flows directly onto your personal tax return. Understanding that connection helps you plan better—and avoid surprises when it’s time to pay up.
Bottom Line: Don’t Leave Your Finances to Chance
Christine was generous with her knowledge, and her message was clear:Tax compliance isn’t just about following rules. It’s about protecting your peace, your profits, and your future.
If this all feels overwhelming, you're not alone.
That’s exactly why we created the Ecomspaces Membership—to give founders real-time support, community, and access to experts like Christine.
Next Steps
Members - Rewatch the webinar recording in the member portal
Need bookkeeping or tax help? Contact Christine Harrison from Accounting Specialties & Tax Solutions
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