October 2019 Economic Nexus Laws

By October 2, 2019 Ecommerce Accounting

The South Dakota vs Wayfair Supreme Court ruling in June of 2018 propelled many states to enact laws that would require remote sellers to collect and remit sales tax. Fast-forwarding to October 2019, most states now have economic nexus laws in effect. Economic nexus is a fancy way of saying that online businesses who have a certain number of sales or transactions within a state are required to collect and remit sales tax.

October 2019 Economic Nexus Laws

On October 1, 2019, seven states have new economic nexus laws in effect:

  • Arizona
  • Kansas
  • Maryland
  • Massachusetts
  • Minnesota
  • Tennessee
  • Texas

These seven states bring the total number of states with economic nexus laws to 43 (plus Washington D.C.). Read below to see if your business meets the sales thresholds for these seven states. If you meet or exceed these thresholds for sales in that state, your business is liable to collect and remit sales tax for those sales. Remember to combine sales across all your sales channels to see if you meet these thresholds.

Also, some states have been kind (finally!) by enacting marketplace facilitator laws. If you have sales on third-party marketplaces, such as Amazon, these laws move the burden of collecting and remitting sales tax from the seller to the marketplace. But remember that if you have sales on non-marketplace channels, you still need to collect and remit sales tax for sales on those channels. Watch our video for more details on these new economic nexus and marketplace facilitator laws.

Ecommerce sales tax

 

Arizona

Threshold: In 2019, $200K in gross revenue (current or previous calendar year). In 2020, $150K. In 2021 and thereafter, $100K.

For more information, click here.

Kansas

Threshold: No threshold. If you have any sales in Kansas, you are liable to collect and remit sales tax for those sales.

For more information, click here.

Maryland

Threshold: $100K in gross revenue or more than 200 separate transactions in the previous or current calendar year.

For more information, click here.

Massachusetts

Threshold: $100K in sales from the previous calendar year.

For more information, click here.

Minnesota

Threshold: $100K in gross revenue or 200 separate transactions in the previous twelve months.

For more information, click here.

Tennessee

Threshold: $500K in sales during the previous twelve months.

For more information, click here.

Texas

Threshold: $500K in sales during the previous calendar year.

For more information, click here.

Become Sales Tax Compliant

For a complete table of economic nexus laws by state, download our “10 Steps to Ensure Sales Tax Doesn’t Burn Down Your Ecommerce Business”. This download will also help you on your journey to sales tax compliance.

Interested in sales tax services? Learn more here.