A. Income Tax. A Wellness Advocate accepts sole responsibility for all self-employment and income taxes due to income earned as a doTERRA Wellness Advocate. At the end of each calendar year, doTERRA will provide a statement of earnings [1099 form] for tax purposes to each Wellness Advocate with an annual income at or over the minimum required to be reported to the United States Internal Revenue Service. Note: Any contest, incentive or prize items may be included in the 1099 form. To the extent required by law, the Company will send notification of the Wellness Advocate’s product purchases and Bonus payments to relevant tax authorities.
B. Sales Tax. doTERRA provides the service of collecting state sales tax at the time of purchase and remitting it to the Wellness Advocate's domicile state. The amount of sales tax is based upon the suggested retail price of a product, calculated at the Wellness Advocate's local tax rate. Wellness Advocates may recoup the prepaid sales tax at the time of retail sale. doTERRA will charge sales tax on the suggested retail price regardless of how the order was placed, according to the tax rates applicable to the state to which products are shipped by doTERRA, unless the Wellness Advocate has submitted a Sales Tax Exemption certificate and a Resale Tax Number. Note: Wellness Advocates are not exempt from taxes when products are sold to tax exempt customers. Sales tax will be charged on the wholesale value of LRP autoship orders, as Wellness Advocates certify and represent to doTERRA that their LRP purchases are for personal use, or for use in their business as samples, gifts, or testing, and that they are not to be resold.
C. Sales Tax Exemption. If allowed by law in a Wellness Advocate’s domicile state, and by the Company, a Wellness Advocate who prefers to collect, document, report, and pay his or her own sales tax may do so by obtaining a Resale Tax Number from the State Department of Tax or Revenue and sending the Company the proper Sales Tax Exemption form that is recognized by his or her state. The Company cannot exempt any Wellness Advocate's order from pre-collected state sales tax until all proper documentation is on file with the Company. The Wellness Advocate agrees to indemnify and hold the Company harmless regarding any liability that it is charged as a result of their failure to collect or remit sales tax.