Selling on AliExpress in the U.S.: Choice, semi-managed, overseas managed or local seller, who pays tariffs, who files taxes, and how to set up the company (2026)

AliExpress is Alibaba International Digital Commerce Group's cross-border retail marketplace, launched in 2010. To reach U.S. buyers, Chinese sellers can choose self-operated, Choice (fully managed), semi-managed or overseas managed, while U.S. businesses use the AliExpressLocal program. The differences come down to three things: who prices and runs the listing, where goods ship from, and who owns the inventory and imports it on the U.S. side.

AliExpress serves buyers in more than 200 countries and regions in 16 languages. Under its membership agreement and privacy policy (version of 2025-10-14), U.S. buyers contract with AliExpress's Singapore entity (AliExpress E-Commerce One Pte. Ltd.), while U.S. sellers contract with AliExpress International (United States) Corporation. Chinese sellers sign up through the Chinese seller portal with a Chinese business license.

Description: Each row is a model, showing who can join, who prices and runs it, where goods ship from, who handles logistics and import, and the U.S. tax impact.

Model	Who can join	Who prices and runs it	Ships from	Logistics and import	U.S. tax impact
Self-operated (POP)	Licensed Chinese businesses (sources disagree on individual businesses)	Seller	China, direct cross-border	Seller picks carriers (Cainiao lines available); direct parcels clear customs and pay duty	Goods handed over in China; generally no U.S. income tax filing
Choice / fully managed	Chinese factories, brands and traders, with product approval	AliExpress prices, markets and handles after-sales; seller quotes a supply price	Cainiao warehouse in China (pre-stocked) or ship-to-order (JIT)	AliExpress and Cainiao handle cross-border, customs and delivery	Same; check where title passes in the contract
Semi-managed	Chinese sellers with operating capacity	Seller keeps pricing, subject to review	China, handed to AliExpress and Cainiao	AliExpress and Cainiao handle cross-border logistics	Same
Overseas managed	Sellers with inventory in a U.S. (or other overseas) warehouse	AliExpress runs marketing, user operations and customer service; seller quotes a supply price including shipping	U.S. warehouse; seller ships locally	Seller (or forwarder) imports into the U.S. and handles last mile	U.S. inventory: importer, inventory states, ECI, Form 5472 or 1120-F
U.S. local seller (AliExpressLocal Direct / Marketplace)	Local, U.S.-based businesses	Direct: AliExpress helps with marketing, pricing tools and customer service; Marketplace: seller prices and markets	Inside the U.S.; seller ships or uses a 3PL	Seller; AliExpress offers a labeling service	Same as an Amazon merchant-fulfilled seller: income tax, state tax, 1099-K

• Names change: "fully managed," "semi-managed" and "overseas managed" are translations of Chinese terms; English material says Choice, semi-managed and overseas managed (or local warehouse). AliExpress's stated focus for 2026 is "brands going global plus overseas managed" (Hangzhou summit, 2026-01-07); fully managed is no longer the headline model.
• Public information is limited: the full rules for the three managed models sit in AliExpress's Chinese recruitment channels and the seller back end, not on public pages. This guide relies on Alibaba Group and AliExpress releases and 2024–2026 trade press; thresholds and fees are whatever your recruitment manager confirms in writing.
• The contract drives the tax result: even with goods in a U.S. warehouse, the answer differs depending on whether you "sell to the platform" or "sell to customers through the platform," and whether the platform pays you "a purchase price" or "sales proceeds minus commission." Have a CPA read the contract before you sign.

Choice is the fully managed service AliExpress officially launched on March 1, 2023: the merchant develops and makes the product, and AliExpress handles customer acquisition, pricing, delivery and after-sales. Semi-managed keeps pricing with the merchant while AliExpress and Cainiao handle cross-border logistics. Overseas managed has the merchant stock an overseas warehouse and ship locally while AliExpress runs marketing and operations. Of the three, only overseas managed gives a Chinese seller inventory in the U.S.

• Choice (fully managed): Alibaba Group's 2024-02-19 explainer says Choice grew out of Cainiao's cross-border fulfillment service and combines the third-party marketplace with a consignment (1P) model into a "fully-entrusted" model; merchants focus on product and manufacturing while AliExpress provides a one-stop service for sales operations, payment, logistics and warehousing. Trade sources describe two supply methods: pre-stocking at Cainiao warehouses in Dongguan, Weihai, Hangzhou and elsewhere, and JIT, where the seller ships to a designated warehouse after each order.
• Semi-managed: piloted in August 2023 and fully launched on 2024-01-04 with Cainiao, opening from invitation-only to any seller who applies. The seller keeps pricing and business data; AliExpress handles fulfillment and after-sales support.
• Overseas managed: launched in late February 2024. The seller stocks a warehouse in the U.S., Europe or elsewhere and handles fulfillment, while AliExpress handles marketing, user operations and customer service, and the seller quotes a supply price that includes shipping. Reports say it now covers more than 30 markets, including the U.S.
• The U.S. "Saiya plan": on 2026-06-17, AliExpress announced a U.S. brand recruitment push. Reported terms include a store opening within 3 days of submitting credentials, an advance of up to 60% of the supply price once goods enter the warehouse, and an ad incentive of up to $1,000 in June. Reports don't say whether a U.S. entity is required.
• Brand+: a brand program launched in September 2025; reports say more than 1,500 certified brands have joined (platform figures).

Like Temu and SHEIN, AliExpress used to rely on small parcels shipped from China straight to U.S. buyers, duty-free under the $800 de minimis rule. De minimis ended for Chinese goods on May 2, 2025 and was suspended for all countries on August 29, 2025, so every parcel now clears customs and pays duty. AliExpress shifted toward overseas managed and U.S. local sellers: goods are imported in bulk into U.S. warehouses and shipped locally.

Description: Read from top to bottom; each row is an event and what it meant for sellers. Tariff policy changes quickly; check the latest CBP and USTR notices.

When	What happened	Effect on sellers
2010	AliExpress launches	Chinese sellers ship cross-border, mostly under de minimis
2023-03-01	Choice (fully managed) officially launches	Chinese factories supply; AliExpress prices and delivers
2024-01-04	Semi-managed fully launches (piloted August 2023)	Sellers price; AliExpress and Cainiao handle logistics
February 2024	Overseas managed launches	Goods in overseas warehouses; sellers ship locally
2024-10-30	AliExpressDirect invites U.S. merchants, with 0% commission and $0 onboarding during an introductory period	U.S. businesses can open AliExpress stores
2025-03-17	AliExpressLocal Marketplace (self-serve) added; Open API launched	U.S. sellers choose Direct or Marketplace
2025-05-02	De minimis ends for mainland China and Hong Kong	Direct-ship costs rise; platforms shift to U.S. warehouses
2025-08-29	De minimis suspended for all countries	Parcels from anywhere pay duty
September 2025	Brand+ program launches	A dedicated marketing channel for brands
2026-02-20	The Supreme Court holds IEEPA doesn't authorize tariffs; IEEPA duties stop; de minimis stays suspended	Importers of record can claim refunds of IEEPA duties paid
2026-06-17	U.S. "Saiya plan" announced	Advances on overseas managed inventory
From 2026-07-24	Section 301 forced-labor action adds 12.5% on Chinese-origin goods	Another layer of import cost
2027-07-01	OBBBA repeals the statutory basis for de minimis	De minimis is not coming back

Description: Each row is a tariff layer or rule, with its status, what it is and the effect on AliExpress sellers. Consistent with the tariff timelines at yclcpa.com/fba, yclcpa.com/temu and yclcpa.com/aigo.

Tariff or rule	Status	What it is	Effect on AliExpress sellers
$800 de minimis	Suspended: ended for China 2025-05-02, suspended for all countries 2025-08-29; OBBBA repeals the statutory basis from 2027-07-01	Small parcels clear customs and pay duty	Direct-ship costs rise; platforms shift to U.S. warehouses
Normal (MFN) duty	Always applies	By HTS code	Classify correctly; build cost sheets by code
Section 301 (China)	In effect	25% or 7.5% on most Chinese-origin goods	Part of inventory cost
Section 301 (forced-labor action)	In effect (from 2026-07-24)	12.5% on Chinese-origin goods, stacked on existing duties	Another layer of cost; be able to document your supply chain
IEEPA tariffs	Stopped: the Supreme Court held on 2026-02-20 that IEEPA doesn't authorize tariffs	Duties paid can be refunded through CBP's CAPE function (from 2026-04-20)	Only the importer of record or its broker can file
Section 122 temporary 10%	Expired (2026-02-24 to 2026-07-24)	150-day temporary surcharge	Goods imported in that window carry it in cost

• What this means for you: a Chinese seller on self-operated, Choice or semi-managed hands goods over in China; duties are handled through the platform's customs arrangements or by the buyer, and the cost flows through retail and supply prices. You generally have nothing to file in the U.S. On overseas managed or a local store, you (or your U.S. company) are the U.S. importer and seller.
• Who can claim IEEPA refunds: only the importer of record or its broker. If a forwarder was importer under DDP terms, the refund belongs to the forwarder unless your contract says otherwise. For putting duties into inventory cost, see yclcpa.com/fba.

Chinese sellers sign up in the Chinese seller back end with a business license, pay a deposit by category, and upload trademark or brand authorization documents. U.S. local sellers are U.S.-based businesses that register, complete verification, set up payments and list. On the U.S. side, the contracting entity, the tax form (W-9 or W-8) and the payout account must match your company name and EIN exactly.

• Chinese sellers: third-party sources list a business license, the legal representative's ID, a corporate or payment account, and a trademark certificate or brand authorization; deposits are by category, mostly RMB 10,000 to 30,000 per these sources, higher for some categories. Whether individual businesses (个体工商户) can join has been reported inconsistently since 2021. Thresholds, deposits and commissions follow AliExpress's current seller rules.
• U.S. local sellers: AliExpress's 2025-03-17 release describes the steps as "register your account, complete the authentication, set up payment processing, and begin listing." Third-party guides list the company name, registration number, tax ID, incorporation date and address, representative details and a bank account. AliExpress has not published a complete U.S. document list; follow the sign-up flow.
• Keep name, EIN and address identical everywhere: if you've lost the EIN confirmation letter (CP 575), call the IRS business line for a 147C letter; if the address changed, file Form 8822-B first. The bank account holder, platform registration and W-9 name should match.
• INFORM Consumers Act: for a high-volume third-party seller (200 or more sales and $5,000 or more in a 12-month period), the platform must collect and verify your bank account, contact details and tax ID; sellers with $20,000 or more in annual sales have their name and address disclosed to buyers.
• U.S. companies with foreign owners: a U.S.-registered company can apply as a U.S. business; if its owners are foreign, keep its Form 5472 filings current and its platform, bank and IRS records consistent.
• Product compliance and IP: CPCs for children's products, certificates for CPSC-regulated consumer products (filed electronically at import from 2026-07-08), FCC authorization for wireless devices and California Prop 65 warnings are for testing labs and attorneys; trademark and infringement complaints go through Alibaba's Intellectual Property Protection platform (IPP) and are handled by attorneys.

Self-operated sellers pay a category commission on sales, mostly 5% to 8% in third-party sources and higher in some categories. Under Choice and overseas managed, AliExpress settles at your supply price and keeps the spread. U.S. local sellers get a three-month free trial; post-trial fees are not published. On logistics, the three China-based models mostly run through Cainiao, and U.S. local sellers can use AliExpress's labeling service.

• Self-operated: you set prices; AliExpress charges a commission by category and holds a deposit. Funds are released after an order completes (buyer confirms receipt or confirmation times out) and can be withdrawn to your linked account. Exact rates and timing are in the back end.
• Choice / overseas managed: you receive the supply price, not the retail price; under overseas managed, the supply price must cover U.S. last-mile shipping. Late shipment, stockouts and quality issues bring deductions; reporting on the 2026 Saiya plan mentions "a 50% reduction in monetized fulfillment penalties," which tells you penalties are charged in dollars. Budget for them.
• U.S. local sellers: at launch in 2024 there was 0% commission and $0 onboarding during an introductory period; since 2025 both models come with a three-month free trial, 1:1 onboarding and launch assistance. Under Direct, AliExpress helps with marketing, merchandising and customer service (including after-sales disputes) at no extra cost; under Marketplace, you control pricing, marketing and MAP. Trade press reports sellers can switch between models at any point. Post-trial commissions and payout timing are per your agreement.
• Logistics: Cainiao, Alibaba Group's logistics company, handles cross-border delivery, consolidation and export warehouses for Choice and semi-managed. In November 2025, AliExpress launched a labeling service for U.S. sellers: buy labels in the seller portal, compare rates and track parcels, with optional photo proof of delivery, and AliExpress can issue return labels even if another carrier handled the outbound shipment.
• Integrations: the Open API and third-party tools (Linnworks, StoreAutomator, Quipt and others) sync listings, inventory, orders and returns, which makes multi-channel reconciliation easier.

A Chinese seller that hands goods over in China and has no U.S. inventory, employees or agents generally needs no U.S. company and has no U.S.-source business income to report. Under Choice, the platform prices and sells, so the seller is closer to a supplier; under self-operated and semi-managed, the seller sells to U.S. buyers through the platform, but goods are handed over in China, so again there is generally no U.S. income tax filing. The contract wording can change the answer.

Description: Each row is an obligation, shown for the three China-based models, overseas managed and U.S. local sellers. The managed-model columns depend on your contract.

Obligation	Self-operated / Choice / semi-managed (ships from China)	Overseas managed (U.S. warehouse, seller ships)	U.S. local seller
Seller on the U.S. side	Self-operated, semi-managed: seller via the platform; Choice: platform-led, check the contract	AliExpress prices and runs it; seller supplies; when title passes depends on the contract	Seller
Importer of record and duties	The platform's or Cainiao's customs arrangements, or the buyer as importer	Seller, its U.S. company, or a forwarder (the forwarder under DDP)	Seller or its supplier
U.S. sales tax	Platform collects from buyers at checkout	Platform collects from buyers at checkout	Platform collects at checkout (marketplace facilitator laws); off-platform sales are yours
State income and franchise taxes	Generally none	Possible in inventory states	Inventory states and the state of formation
Form 1099-K	Generally not relevant (foreign sellers give a W-8BEN-E)	Depends on who is paid: a U.S. company over the threshold receives one	Received at $20,000 and 200 transactions
U.S. federal income tax	Generally no U.S.-source business income	The Chinese company may have ECI and file 1120-F; or a U.S. subsidiary files 1120	1120, 1120-S or Schedule C
Form 5472	None without a U.S. company	Every year for a foreign-owned U.S. company or foreign-owned single-member LLC	Every year when 25%+ foreign-owned

• Read three lines in the contract: whether you "sell to AliExpress" or "sell through AliExpress to customers"; where title and risk pass; and who is the U.S. importer. If title passes to the platform in China, your income is generally an export sale in China.
• Duties on direct parcels: with de minimis gone, every parcel from China clears customs and pays duty. Who is importer and whether duty is charged to the buyer at checkout or borne by the seller follows the platform's current customs arrangements and your agreement. Public sources don't give a single answer; follow the back-end notices.
• Chinese taxes: VAT, export rebates and enterprise income tax follow Chinese rules and are for your Chinese accountant; this guide doesn't cover them.
• Being asked for a W-8BEN-E: a foreign company paid by a U.S. payer may be asked for a W-8BEN-E to certify foreign status. See yclcpa.com/w8ben for how to complete it.

Overseas managed is the most overlooked U.S. tax issue on AliExpress. AliExpress prices and runs the listing, but the goods sit in a U.S. warehouse and the seller ships them, so until a sale the inventory generally still belongs to the seller. A Chinese company that imports in its own name and sells from U.S. inventory very likely has effectively connected income (ECI), needs to look at the U.S.–China treaty and files Form 1120-F; many sellers move import and supply into a U.S. subsidiary instead.

• Confirm three facts first: who is importer of record when goods enter the U.S.; who owns the inventory while it sits in the U.S. warehouse (you or the platform); and whether the platform pays you a purchase price (a sale to the platform) or sales proceeds minus commission (a sale through the platform). An "advance on warehouse entry" policy generally signals that goods still belong to you until sold and the platform is fronting part of the money.
• Selling through the Chinese company directly: a foreign corporation engaged in a U.S. trade or business has ECI on related income and files Form 1120-F. Article 5 of the U.S.–China treaty excludes from a permanent establishment "the use of facilities solely for the purpose of storage, display or delivery of goods" belonging to the enterprise and the maintenance of a stock of goods solely for storage, display or delivery. Without a PE, business profits are generally not subject to federal income tax, but the treaty position is disclosed on Form 8833 with the 1120-F. U.S. employees, agents who conclude contracts for you, or a contract that makes the platform a dependent agent can change the answer, so this is a case-by-case analysis.
• File the 1120-F on time: a foreign corporation with no U.S. office generally files by the 15th day of the sixth month after year-end (June 15 for calendar years). Under Treas. Reg. §1.882-4, a return not filed within 18 months of the due date can lose its deductions, which is why many companies file a protective 1120-F.
• States don't follow the treaty: inventory in a state gives you physical presence there; state income and franchise taxes generally aren't limited by federal tax treaties, and P.L. 86-272 doesn't protect sellers that keep inventory in the state.
• Using a U.S. subsidiary for import and supply: the Chinese factory sells to its U.S. subsidiary, which imports, owns the U.S. inventory and signs the overseas managed agreement. The subsidiary files 1120 + 5472 at 21% federal tax; related-party prices must meet Section 482, and tax inventory cost generally can't exceed customs value (Section 1059A). Decide whether the Chinese company or the U.S. subsidiary signs before onboarding; changing later is painful.

AliExpressLocal is for U.S.-based businesses. A U.S. resident can join through a single-member LLC or a corporation; a U.S. company owned by foreign persons can also apply, with Form 5472 every year. The platform collects sales tax from buyers at checkout on platform orders, U.S. sellers over $20,000 and 200 transactions receive a 1099-K, and income goes on Schedule C or the company return.

• Entity: U.S. residents often start with a single-member LLC (Schedule C plus self-employment tax) and consider an S corporation as profits grow; foreign owners or foreign companies usually use a C corporation or an LLC electing corporate treatment.
• Tax form: U.S. persons and U.S. entities give a W-9 whose name and TIN match IRS records; a mismatch triggers 24% backup withholding from payouts. A foreign-owned single-member LLC (a disregarded entity) should, under the W-9 instructions, give the owner's W-8.
• Form 1099-K: U.S. sellers paid more than $20,000 in more than 200 transactions in a year get a 1099-K. It shows gross amounts, including shipping and pre-refund amounts, and must be reconciled line by line to settlement reports (see yclcpa.com/1099k). Which AliExpress entity issues it is per the back end and the form you receive.
• Sales tax: under state marketplace facilitator laws, the platform generally collects and remits sales tax on platform orders, and AliExpress charges sales tax at checkout on U.S. orders. Sales on your own site, wholesale or in person are yours to assess, and some inventory states require the seller to register anyway. North Carolina rules are at yclcpa.com/salestax; your own store at yclcpa.com/stripetax.
• Pricing under Direct: AliExpress helps set prices and promotions under Direct. Whether a promotion is your discount or a platform subsidy changes how it's booked, so record them separately from the agreement and settlement reports.

An LLC owned by one foreign person that hasn't elected corporate treatment is a "disregarded entity" for U.S. tax: the foreign owner generally gives the platform a W-8 (a W-8ECI when there is business income), not a W-9 under the LLC's EIN; the LLC files pro forma 1120 + 5472 every year; and with U.S. inventory and business income, the owner files a 1040-NR. Elect corporate treatment on Form 8832 and the LLC files Form 1120 at 21% federal tax.

• W-9 or W-8: under the W-9 instructions, a disregarded entity with a foreign owner provides a W-8, even if the LLC has its own EIN. If the back end only offers a W-9, ask the platform and follow your CPA's advice (see yclcpa.com/w8ben).
• Pro forma 1120 + 5472: a foreign-owned single-member LLC with any transactions with its owner (contributions, expenses paid, loans) files by April 15 every year, by fax or mail; e-filing isn't available. Each missed form starts at $25,000 (see yclcpa.com/5472).
• Form 8832 election: after electing, the LLC files Form 1120 at 21% federal tax, with Form 5472 if 25% or more foreign-owned; the owner no longer files a 1040-NR for the LLC's business income. The election can be retroactive up to 75 days; under Treas. Reg. §301.7701-3(c)(1)(iv), after a change in classification you generally can't change again for 60 months (an election effective on formation is an exception).
• Dividends: dividends from a C corporation to foreign shareholders generally bear 30% withholding, reduced to 10% for Chinese tax residents under the treaty with a W-8BEN or W-8BEN-E.
• No S corporation: foreign individuals and foreign companies can't be S corporation shareholders.
• Full analysis: for W-9 vs W-8 and the pros, cons and 60-month lock of Form 8832, see yclcpa.com/walmart; for C-corp elections, see yclcpa.com/ccorp.

It depends on who you are, where goods change hands and which other platforms you sell on. A Chinese factory using only China-based models generally needs no U.S. company. For overseas managed, most sellers use a U.S. subsidiary as importer and contracting party. A U.S. resident starting as a local seller can use a single-member LLC. Foreign owners selling locally through a U.S. company usually use a C corporation or an LLC that elects corporate treatment.

Description: Each row is a type of seller, with the usual entity, the platform tax form, annual federal filings and what to watch. The right choice depends on your facts.

Who you are	Usual entity	Platform tax form	Annual federal filings	Watch for
U.S. resident (citizen, green card holder, resident alien) as local seller	Sole proprietorship or single-member LLC; S corp as profits grow	W-9 (SSN or EIN)	Schedule C plus SE tax; Form 1120-S for an S corp	1099-K reconciliation; inventory-state taxes
One foreign individual selling locally through a U.S. LLC	Single-member LLC (disregarded), LLC electing on Form 8832, or C corp	Disregarded: owner's W-8 (usually W-8ECI); electing LLC or C corp: W-9	Disregarded: pro forma 1120 + 5472, owner's 1040-NR; corporation: 1120 + 5472	ECI; 8832's 60-month lock; dividend withholding
Chinese company on self-operated, Choice or semi-managed	No U.S. entity needed	W-8BEN-E if asked	Generally none	Title transfer and importer terms in the contract
Chinese company on overseas managed, importing directly	The Chinese company itself	W-8BEN-E (when claiming the treaty) or W-8ECI	Form 1120-F (with 8833, claiming no PE under the treaty)	Inventory-state taxes; file the 1120-F within 18 months of its due date
Chinese company + U.S. subsidiary (overseas managed or local store)	U.S. C corporation (subsidiary)	W-9 (subsidiary's EIN)	1120 + 5472; BE-13 within 45 days	Related-party pricing (§482), §1059A, consistent customs values
Multi-platform seller (AliExpress + Amazon + Temu + own site)	One U.S. company, books split by channel	Same name and EIN on every platform	As above	Reconcile each platform's 1099-K; assess inventory states together

• State of formation: Wyoming ($100 to form, $60 minimum annual report) and Delaware are common. A warehouse in California that meets California's "doing business" test brings the $800 minimum franchise tax; a warehouse in Texas means Texas franchise tax reports, with a no-tax-due threshold of $2,650,000 for 2026 and 2027 reports and an information report due even below it. See yclcpa.com/llc for state comparisons and yclcpa.com/entity for entity types generally.
• BE-13 and BOI: a foreign person who forms a U.S. company and acquires 10% or more of the voting interest files BE-13 with the Bureau of Economic Analysis within 45 days; domestic U.S. companies no longer file BOI reports (see yclcpa.com/boi).
• ITIN: a foreign owner who must file a 1040-NR and has no SSN applies for an ITIN, generally with the return (see yclcpa.com/itin).

When a U.S. subsidiary buys from its Chinese parent or a related factory, prices must be arm's length (Section 482); customs values, transfer pricing and book inventory cost should line up; tax inventory cost generally can't exceed customs value (Section 1059A); and a 25%+ foreign-owned U.S. company reports related-party amounts on Form 5472 every year.

• The overseas managed twist: the U.S. subsidiary buys from the factory and then sells to the platform at a supply price (or through the platform to customers), so its profit sits between two prices. If the factory price is too high and the subsidiary loses money year after year, the IRS may adjust under Section 482; if customs values are too low, you have a customs problem.
• Document it: support prices with a profit-margin or comparable-price analysis, and match purchase contracts, invoices, entry documents and payments one to one.
• Form 5472 amounts: purchases, loans, expenses paid on the company's behalf and service fees all go on it; each missed form starts at $25,000.
• Full method: see yclcpa.com/subsidiary.

The big differences are who is the seller, who sets the price and where goods change hands. On Amazon, Walmart, Etsy and TikTok Shop local stores, you are the seller and set the price, and the platform collects sales tax and issues 1099-Ks to U.S. sellers. On Wayfair you sell wholesale to Wayfair. AliExpress, like Temu, has China-based managed models that work more like supplying the platform, while overseas managed and local selling require U.S. inventory.

Description: Each row is a platform or model, showing the U.S. seller, main fees, fulfillment, who can join, sales tax, 1099-K and payouts.

Platform / model	U.S. seller	Main fees	Fulfillment	Who can join	Sales tax	1099-K	Payout
AliExpress self-operated / semi-managed	Seller (through the platform)	Category commission (mostly 5%–8% per third-party sources) and deposit, per back end	Direct from China; semi-managed via AliExpress and Cainiao	Licensed Chinese businesses	Platform collects from buyers	Generally not relevant for foreign sellers	Released after order completion, per back end
AliExpress Choice / overseas managed	Platform-led pricing and sales; contract decides title	Settled at your supply price; platform keeps the spread; fulfillment deductions	Choice: Cainiao warehouse in China; overseas managed: U.S. warehouse, seller ships	Chinese sellers with approval; overseas managed needs overseas stock	Platform collects from buyers	Depends on who is paid	Per contract; Saiya plan advances up to 60% on warehouse entry
AliExpress U.S. local seller	Seller	Three-month free trial; later fees not published	Seller ships or uses a 3PL; platform labels available	U.S.-based businesses	Platform collects at checkout	U.S. sellers over the threshold	Per agreement
Temu	Fully managed: Temu; semi-managed / local: seller	No published general schedule	China warehouse or U.S. warehouse	Chinese businesses; local: U.S. businesses and residents	Temu collects from buyers	U.S. sellers over the threshold	Per back-end rules
Amazon	Seller	Professional plan $39.99/month, referral fees mostly 8%–15%, plus FBA fees	FBA or merchant-fulfilled	U.S. and international sellers (including China)	Amazon collects	Yes	Generally 14-day settlement periods
Walmart	Seller	No monthly fee; referral fees about 6%–15% by category	WFS or merchant-fulfilled	Application-based; mainly U.S. sellers, some international	Walmart collects	Yes	Per the seller agreement's settlement cycle
Wayfair	Wayfair (you are the supplier)	Wholesale price under the supply agreement	Drop ship or CastleGate warehouses	Supplier approval	Wayfair collects from buyers	Wholesale payments; check with Wayfair	Per contract terms
Etsy	Seller	$0.20 listing fee, 6.5% transaction fee, U.S. payment processing 3% + $0.25	Seller ships	Handmade, vintage and craft supply sellers	Etsy collects	Yes	Per Etsy Payments settings
TikTok Shop	Seller (except managed models)	About 6% referral fee in most categories (May 2026 schedule)	Platform logistics or approved warehouses	Local stores; cross-border stores by invitation	Platform collects	Yes	Per Seller Center rules

• AliExpress's strengths: one back end reaching 200+ countries, with Europe, Latin America and Korea beyond the U.S.; mature Cainiao logistics; a free trial for U.S. local sellers, with AliExpress handling customer service and marketing under Direct.
• AliExpress's weaknesses: less U.S. traffic and brand recognition than Amazon; managed models mean little pricing power, thin margins and frequent deductions; post-trial fees for U.S. local sellers aren't public, so negotiate them.
• Alibaba.com is a different channel: Alibaba.com is Alibaba's B2B wholesale marketplace, where Chinese factories sell to U.S. business buyers. The buyer usually imports (FOB or EXW terms), or you arrange import under DDP. Alibaba.com collects sales tax on U.S. buyers' orders under marketplace facilitator laws, and resellers can claim exemption with a certificate through its ASTEP program. That is a separate business from selling to consumers on AliExpress, with different U.S. tax arrangements.
• Selling on several platforms: one U.S. company on several platforms reconciles each 1099-K separately and looks at inventory states together. Temu: yclcpa.com/temu; SHEIN: yclcpa.com/shein; the full Walmart analysis: yclcpa.com/walmart; Amazon: yclcpa.com/amazon and yclcpa.com/fba; TikTok: yclcpa.com/tiktok; eBay: yclcpa.com/ebay; your own store: yclcpa.com/shopify.

Download settlement and order reports every month and record gross sales, commissions, deductions, returns and refunds, and shipping separately. Track inventory and cost of goods sold by unit, with duties and inbound freight in inventory cost. Under managed models, recognize revenue at the supply price and record deductions and returns separately; an advance on overseas managed inventory is a customer deposit, not revenue.

• Book revenue gross: payouts are net of fees. Record revenue gross and list each fee, so the 1099-K reconciles.
• Advances: money received under an "advance on warehouse entry," for goods not yet sold and still owned by you, is generally a customer deposit (a liability) until the sale; match the amounts the platform claws back.
• Deductions and penalties: platform deductions are business expenses; fines paid to a government for breaking the law aren't deductible, but platform deductions aren't government fines. Record the reason for each.
• Returns: refunds reduce revenue; resalable returns go back into inventory, and write-offs need records.
• Currencies: record USD settlements and withdrawal exchange rates on the transaction date and show FX gains and losses separately.
• Year-end count: keep quantities and values by warehouse and tie them to overseas warehouse and 3PL inventory reports. Small businesses with average gross receipts of $32,000,000 or less can use simplified inventory methods (see yclcpa.com/fba).

Choose the model and contracting entity first, then align your documents and import and warehouse arrangements, and finally set up the books and filing calendar. Work through this list in order.

Description: From top to bottom, the steps to finish before onboarding, each with what to do and why.

Step	What to do	Why
1	Choose the model: self-operated, Choice, semi-managed, overseas managed or U.S. local seller	Decides where goods change hands and whether you need a U.S. company
2	Choose the contracting entity: Chinese company, U.S. subsidiary, LLC or individual	The contracting entity files the returns and receives any 1099-K
3	Get the EIN letter (CP 575 or 147C) and align name, address and bank account holder	Platform, bank and IRS records must match
4	Decide whether the platform gets a W-9 or a W-8	A wrong form means 24% withholding or re-papering
5	Overseas managed: choose the importer, customs broker and bond, and agree customs values with the factory	Duties, refund claims, §1059A
6	Choose warehouses: your own, an overseas warehouse or a 3PL, and in which states	Sales, income and franchise taxes in inventory states
7	Product compliance and trademarks	Labs and attorneys; avoid takedowns and detentions
8	Model profit: supply or retail price, duties, last-mile shipping, deductions, returns	Managed-model margins are thin; check the math first
9	Get post-trial fees and payout timing in writing	Local seller fees aren't published
10	Set up books and an annual calendar: BE-13, 1099s, state reports, federal returns due April 15 or June 15	Each missed Form 5472 starts at $25,000

Example (hypothetical numbers, to show the method): Company B in Ningbo makes desk lamps and has sold on AliExpress semi-managed. In 2026 it wants to join overseas managed in the U.S., stocking an overseas warehouse in New Jersey. The owner is a Chinese tax resident with no U.S. status. We compared two approaches.

Approach B, year one:

• The subsidiary buys 5,000 units from Company B at a customs value of $12 each, $60,000 in total; duty at an assumed 37.5% is $22,500; ocean freight and customs fees are $7,500. Unit inventory cost = ($60,000 + $22,500 + $7,500) ÷ 5,000 = $18.00.
• It sells 4,000 units at a $30 supply price (including last-mile shipping) for $120,000; cost of goods sold is 4,000 × $18 = $72,000.
• Warehouse and last-mile costs at $6 a unit total $24,000; platform deductions and return losses $3,000; bookkeeping, registered agent and other costs $6,000.
• Pre-tax profit = $120,000 − $72,000 − $24,000 − $3,000 − $6,000 = $15,000; federal corporate tax at 21% = $3,150.
• The 1,000 units left at year-end are $18,000 of inventory, not deductible this year; any advance received at warehouse entry for unsold goods is a customer deposit. New Jersey corporate tax is computed separately.

Now the related-party angle: if Company B priced the lamps at $22, the subsidiary's profit would disappear and the IRS could adjust under Section 482; if customs value were declared at $8 while the books carried $12, Section 1059A generally limits the subsidiary's cost to the customs value. Customs values, contract prices and book cost should agree.

Start with how you sell now and whether you have a U.S. entity, then look at where you want to go. Here are the common cases.

• Case A: a Chinese factory on self-operated, Choice or semi-managed only. Goods are handed over in China, so generally no U.S. company is needed. Read the contract on title transfer, importer and deductions; give a W-8BEN-E if asked. Chinese taxes are for your Chinese accountant.
• Case B: joining overseas managed or the Saiya plan. Decide the contracting entity first (the Chinese company directly or a U.S. subsidiary), then the importer and overseas warehouse; plan purchase prices, customs values and transfer pricing with the factory; a new U.S. company files BE-13 within 45 days.
• Case C: a Chinese company already selling from U.S. warehouse stock. Check whether Form 1120-F and Form 8833 were filed for past years and whether inventory states expect returns; file missed years soon, since waiting can cost you your deductions.
• Case D: already selling through a foreign-owned single-member LLC. Check whether pro forma 1120 + 5472 and the 1040-NR were filed in past years, whether the platform has a W-9 or a W-8, and whether a Form 8832 election makes sense. File missed years first, with a reasonable-cause statement.
• Case E: a U.S. resident or U.S. company as a local seller. Give a W-9; report on Schedule C or the company return; reconcile the 1099-K to settlement reports; pin down post-trial fees before the trial ends; look at state taxes wherever inventory sits.