Temu U.S. Local Seller Program: Requirements, EIN and CP 575, Form 1099-K, Self-Employment Tax and Sales Tax

Temu's local seller program is for businesses registered in the U.S. and U.S. resident individuals who sell from U.S. inventory. At onboarding, a business's name and EIN must match the IRS EIN confirmation letter (CP 575), the representative verifies identity, and payouts go to a U.S. bank account. After launch you give the platform a W-9, report income on Schedule C or a company return, receive a 1099-K once you pass $20,000 and 200 transactions in a year, and Temu collects sales tax from buyers at checkout on platform orders.

Who can be a local seller

Temu splits seller sign-up by where the business is registered or where you live. Choose the U.S. and you use the U.S. Seller Center; sellers from mainland China and Hong Kong go to the Chinese fully and semi-managed back end. The local seller program launched in the U.S. in March 2024, and sign-up offers individual, sole proprietorship, corporation or partnership. According to Temu's material, U.S. local sellers have also been able to sell into Canada since December 2025.

A U.S. company owned by a Chinese national can apply as a U.S. business if it has the EIN letter, a U.S. address and a U.S. bank account. If its owners are foreign, it has Form 5472 filings every year, covered below.

What you need to onboard

Name and EIN matching the CP 575. Temu's material says a business enters its name and EIN exactly as they appear on the CP 575, plus a registered business address. The CP 575 is the confirmation letter the IRS mails when it assigns an EIN; if you've lost it, call the IRS business line for a 147C letter. If the address on it is out of date, file Form 8822-B before onboarding.

Identity verification. The representative uploads a valid government ID through a third-party verification service (Jumio) and provides name, ID number, citizenship, date of birth and address. Temu says review normally takes about one business day.

INFORM Consumers Act checks. 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. On September 5, 2025, the FTC and DOJ announced a $2,000,000 civil penalty against Whaleco, Temu's operator, under this law, so expect verification to get stricter. Keep the bank account holder, address and tax ID identical everywhere.

The W-9 and backup withholding

U.S. persons and U.S. entities give a W-9. Individuals use an SSN (or ITIN); corporations and multi-member LLCs use an EIN. For a single-member LLC, line 1 shows the owner's name and line 2 the LLC's name, with the TIN entered as the instructions direct. The name and TIN must match IRS records exactly; if they don't, the platform must backup-withhold 24% of your payouts.

A foreign-owned single-member LLC is different. An LLC owned by one foreign person that hasn't elected corporate treatment is disregarded for tax, and the W-9 instructions say the owner should give a W-8 rather than a W-9 under the LLC's EIN.

Reconciling the 1099-K

If you are paid more than $20,000 in more than 200 transactions in a year, the platform issues a 1099-K. It shows gross amounts, which can include shipping and amounts before refunds, while your actual payouts are net of platform charges, penalties and refunds. Report revenue gross, list the charges, and keep the settlement reports that explain the difference so the 1099-K and your return tie out. Income below the threshold, with no 1099-K, is still taxable.

How the income is taxed

Individual or single-member LLC. A U.S. resident selling as an individual or through a single-member LLC reports on Schedule C. Net profit is subject to self-employment tax (Social Security and Medicare, 15.3% combined, computed on 92.35% of net earnings, with the Social Security part capped at the wage base), plus income tax at individual rates. No one withholds for you, so quarterly estimated payments are usually needed.

Consider an S corporation as profit grows. At some level of profit, an LLC electing S corporation status can pay you a reasonable salary and pass through the rest without self-employment tax, at the cost of payroll filings and Form 1120-S. Run the numbers on profit and a reasonable salary before deciding.

C corporation. Federal tax is 21%, and profit can stay in the company; shareholders pay tax again on dividends.

Example (hypothetical numbers, to show the method): Wang is a U.S. resident selling on Temu through a single-member LLC. His 1099-K shows $86,000; refunds were $4,000 and platform charges and penalties $6,000, so actual payouts were $76,000. Cost of goods sold, including duties, was $38,000, shipping $14,000, and packaging and software $3,000. Schedule C net profit = $86,000 − $4,000 − $6,000 − $38,000 − $14,000 − $3,000 = $21,000. Self-employment tax is about $21,000 × 92.35% × 15.3% ≈ $2,967, plus income tax at his individual rates, with half of the self-employment tax deductible in computing income tax.

Sales tax and inventory states

Temu's terms say it collects sales tax from buyers at checkout, and state marketplace facilitator laws generally require the platform to collect and remit on platform orders. Sales on your own site, wholesale or in person are yours to assess and collect, and some states where you hold inventory still want the seller registered. Inventory in a state can also bring state income or franchise tax.

A Chinese-owned U.S. company as a local seller

A U.S. corporation 25% or more foreign-owned attaches Form 5472 to its Form 1120 every year. A single-member LLC owned by one foreign person files pro forma Form 1120 with Form 5472 every year if it has any transaction with its owner (capital, expenses paid, loans). Each missed form starts at a $25,000 penalty. The platform, bank and IRS records need to match, and mismatches are a common reason verification gets stuck.

Learn more

The difference between fully managed, semi-managed and local selling, an entity-choice table, a platform comparison and a pre-onboarding checklist are in our Temu seller guide; 1099-K reconciliation is covered in our Form 1099-K guide. If you're getting ready to onboard and want the entity and taxes sorted first, book a free 15-minute call or message us on WeChat at YCLUSA.