The paperwork is darned fiddly. My own wee house has recently re-registered in Canada, which has a treaty with the US, but we must still jump through hoops like circus poodles. Mind you, the paperwork is good for other US-based ebook retailers as well as for Smashwords, so -- as a small publisher rather than individual author -- it's in our interests to do our best to comply.
Smashwords is always as good as its word in helping independent authors as much as pos, but for those looking for an alternative, try the new Silver Publishing in South Africa, which does a similar job. Athough not yet anywhere near as big as SW, they seem to play from a similarly square bat. Cheers. Neil