Does Your Business Sell Products or Services Out Of State?

You’ll need to be aware of economic nexus laws

You are considered a remote seller if you sell products or services into a state in which you do not have a physical presence.

If you exceed certain dollar or transaction thresholds, many states have enacted economic nexus laws requiring remote sellers to collect and remit sales tax.

The laws vary by state and can be complicated. For example, some states base economic nexus on satisfying either the dollar amount of sales OR number of transactions threshold, while other states base economic nexus on satisfying BOTH thresholds.

The threshold amounts can also vary. In one state, 100 transactions may cause economic nexus but in another state 500 transactions are allowed before a remote seller has economic nexus. The economic nexus laws become very burdensome on compliance depending on the number of states remote sales are sourced.

The chart found in this article, from the Streamlined Sales Tax Governing Board, provides a summary by state of the economic nexus thresholds and compliance dates as of Nov. 19, 2021.

Please reach out to your Barnes Wendling CPAs advisor if you have any questions pertaining to economic nexus or remote sales.

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