samsclub.com Drop Ship Vendors (DSV): Who Collects Sales Tax, and Why Your Warehouse State Matters

Items on samsclub.com that ship straight from a supplier's warehouse are mostly drop ship vendor (DSV) orders: the member buys from Sam's Club, Sam's Club buys from you, you ship from your warehouse to the member and invoice Sam's Club. Sam's Club charges the member sales tax; your sale to Sam's Club is for resale, so with a resale or exemption certificate you don't charge it. What you do need to watch is your warehouse state: wherever your goods sit, you have physical presence.

What is DSV, and how is it different from marketplace self-fulfillment?

Sam's Club's November 2023 DSV onboarding webinar lays out the flow: sign the agreement, set up items, set up a supplier number and ship nodes, load inventory. When a member orders, you receive it by EDI (850 purchase order, 855 acknowledgment, 856 ship notice), API or Supplier Hub, ship on Sam's Club's designated carriers under third-party billing, send tracking back and invoice with an EDI 810 or similar. Returns go to a samsclub.com return center, and performance is measured by post-purchase member surveys, on-time shipping and cancellations.

When a marketplace seller fulfills its own orders on Walmart Marketplace or Amazon, the seller is the seller: the platform takes a referral fee, collects sales tax and issues a 1099-K. A DSV is a supplier and Sam's Club is the seller; your income is the wholesale price on the purchase order, with no referral fee and no 1099-K. As of November 2026 we found no open samsclub.com program for third-party sellers, so drop ship items there are handled as supplier sales.

Who collects sales tax?

Sam's Club is the retailer: it charges members sales tax and remits it to the states. Your sale to Sam's Club is a sale for resale. With the resale or exemption certificate each state requires, you don't charge sales tax on the wholesale sale. Sam's Club's DSV materials list Walmart's sales tax operations team as the contact for resale certificates.

Do you register for sales tax?

A wholesale-only supplier often has no sales tax to collect, but watch three things. Some states require wholesalers to register before they can accept resale certificates. Your warehouse state often expects a business with physical presence to register. And if you also sell at retail through your own site, Amazon or Walmart Marketplace, the economic nexus thresholds for those sales (usually $100,000 a year; $500,000 in California, Texas and New York) are a separate test. North Carolina's rules are in the NC sales tax guide.

Keep the certificates

In a state audit, untaxed wholesale sales are supported by resale or exemption certificates. Expired or incomplete certificates can mean an assessment. Formats differ by state, and not every state accepts the multistate (MTC or SST) forms.

Your warehouse state is a tax state

Physical presence doesn't depend on sales volume. Goods in a warehouse in a state, your own or a third-party logistics (3PL) provider's, give you physical presence there. Under DSV the goods stay your inventory until they ship to the member.

P.L. 86-272 usually doesn't help. The federal law shields sellers of tangible goods from state income tax only when their in-state activity is limited to soliciting orders. Storing inventory in the state generally goes beyond that, and the law doesn't cover gross-receipts-style taxes such as the Texas franchise tax or Washington B&O.

Common state taxes: the Texas franchise tax no-tax-due threshold is $2,650,000 for 2026 and 2027 reports, and you still file below it; California's minimum franchise tax is $800 once inventory or sales meet its tests, with an 8.84% corporate rate; North Carolina taxes corporations on income and franchise. Move the warehouse and the obligations move with it.

State of formation isn't the state of tax. A Wyoming or Delaware company with a North Carolina warehouse registers in North Carolina as a foreign entity and pays North Carolina tax.

Booking returns, deductions and freight

Revenue: generally recognized when you ship, at the purchase order's wholesale price, subject to the agreement.

Freight: shipments on Sam's Club's third-party billing accounts don't hit your books; any freight or handling you bear under the agreement is an expense.

Returns: members return items to Sam's Club's return center, and Sam's Club deducts the cost and a handling fee under the agreement. The cost charged back reduces sales, the handling fee is an expense, and goods returned to you go back into inventory or are written off by condition.

Performance penalties: fines for late shipments or cancellations are expenses in their own account, so they can be checked against the agreement and disputed.

An example

Example (hypothetical numbers, to show the method): Company C is a Delaware company with a North Carolina warehouse. It ships 12,000 samsclub.com DSV orders in a year at a $38 cost each, invoicing $456,000. Members return 400 orders; Sam's Club charges back $15,200 plus $2,000 of handling fees, and $1,000 of performance penalties.

C books $456,000 of sales, reduces them by $15,200 of returns for $440,800 of net sales, and expenses the $3,000 of fees and penalties. Sam's Club collects sales tax from members, and C doesn't charge it, on a resale certificate. Because the warehouse is in North Carolina, C registers there as a foreign entity and files North Carolina income and franchise tax; if C also sells at retail through its own site and crosses North Carolina's threshold, it registers for sales tax too. There's no 1099-K, so invoices are matched to bank deposits.

The takeaway

DSV looks like marketplace self-fulfillment, but for tax it is wholesale: sales tax belongs to Sam's Club, and your job is resale certificates, warehouse-state income and franchise tax, and reconciling returns and deductions. Routes into Sam's Club and entity choices are in the Sam's Club guide. If you're not sure what your warehouse state requires, book a free 15-minute call or add WeChat YCLUSA.