Understanding the intricate web of sales tax nexus thresholds is key for businesses navigating the complexities of state taxation laws. As the digital age continues to reshape traditional business models, the concept of nexus—the connection between a business and a taxing jurisdiction—has become a focal point in determining tax obligations. Nexus can be created by physical presence (i.e.; employees or contractors in a state, an office, or inventory) or economic .
The table below aims to shed light on the diverse nexus thresholds established by individual states across the United States when determining economic nexus for sales tax. Each state presents its own set of criteria that trigger nexus for sales, income, and other tax purposes. By delineating these thresholds, businesses can proactively strategize their operations to ensure compliance and mitigate potential liabilities.
As a business operating in one, or many, of these states, its truly vital that you have clear knowledge of their tax regulations and nexus thresholds.
Things can get a little messy in these matters, so consult the below table, consider your individual fact pattern and then come to Miles Consulting – we’ll help you understand your unique tax challenges, whatever state you’re in. Our professionals can help with sales tax compliance (filing returns when and where you need to), retroactive remediation, merger and acquisition due diligence, and audit support, among others.
We start most conversations with clients by talking about nexus because that determination is the starting point of a relationship with a state and its taxing authority. Once nexus is established, a company has an obligation to then determine if its products and services sold to customers in that state are subject to sales tax, whether there are relevant exemptions, and then their requirements to file sales tax returns. Nexus is just the first step in the process of becoming compliant.
The chart below is a great starting point…and then we can help you apply it to your situation. Contact us for a conversation about your situation and how we can help.
Book a consultation with Miles Consulting, drop us a line, or send us an email at info@milesconsultinggroup.com.
| Economic Nexus Threshold for Sales Tax | |||||||
| State | Effective date | Economic nexus threshold | Time period the threshold is based on | Inclusions/exclusions from the remote seller’s threshold calculation | Is registration required if all sales are marketplace sales? | ||
| Alabama | 10/1/2018 | Monetary: $250,000 Transaction: N/A | Previous calendar year | Type of sales to include: Retail sales Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Include |
No | ||
| Alaska | 4/1/2020 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Arizona | 10/1/2019 | Monetary: 10/1/2019 $200,000 1/1/2020 $150,000 1/1/2021 $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Exclude Sales for resale: Include | No | ||
| Arkansas | 7/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: The sale of TPP, taxable services, a digital code, or specified digital products Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Exclude |
No | ||
| California | 4/1/2019 | Monetary: 4/1/2019 $100,000 4/26/2019 $500,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Total combined sales of TPP Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Colorado | 6/1/2019 | Monetary: $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Retail sales Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Include |
No | ||
| Connecticut | 12/1/2018 | Monetary: 12/1/2018 $250,000 7/1/2019 100,000 AND Transaction: 200 | 12-month period ending on September 30th | Type of sales to include: Monetary portion of the threshold: gross sales AND Transaction portion of the threshold: retail sales Sales through a marketplace: Include for both monetary and transaction portion Sales for resale: Exclude for transaction portion, but include for monetary portion Exempt sales: Include for both monetary and transaction portion | Yes | ||
| District of Columbia | 1/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Retail sales Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
No | ||
| Florida | 7/1/2021 | Monetary: $100,000 Transaction: N/A | Previous calendar year | Type of sales to include: Retail sales of TPP Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Exclude |
No | ||
| Georgia | 1/1/2019 | Monetary: 1/1/2019 $250,000 1/1/2020 $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Retail sales of TPP Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
No | ||
| Hawaii | 7/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Gross sales of TPP, services, and intangibles Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
Yes | ||
| Idaho | 6/1/2019 | Monetary: $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Illinois | 10/1/2018 | Monetary: $100,000 OR Transaction: 200 | Prior 12 months | Type of sales to include: Gross sales of TPP Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Include |
|||
| Indiana | 10/1/2018 | Monetary: $100,000
Transaction: |
Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
No | ||
| Iowa | 1/1/2019 | Monetary: $100,000 Transaction: 1/1/2019 200 7/1/2019 N/A | Previous or current calendar year | Type of sales to include: Gross revenue from sales of TPP, services, or specified digital products Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Kansas | 7/1/2021 | Monetary: $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Kentucky | 10/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Louisiana | 7/1/2020 | Monetary: $100,000 | Previous or current calendar year | Type of sales to include: Gross sales of TPP Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
No | ||
| Maine | 7/1/2018 | Monetary: $100,000 Transaction: 7/1/2018 200 1/1/2022 N/A | Previous or current calendar year | Type of sales to include: The sale of TPP, products transferred electronically, or taxable services Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
Yes | ||
| Maryland | 10/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: The sale of TPP and/or taxable services Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Massachusetts | 10/1/2019 | Monetary: $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Gross sales of TPP and/or services Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
No | ||
| Michigan | 10/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Minnesota | 10/1/2018 | Monetary: $100,000 OR Transaction: 10/1/2018 100 10/1/2019 200 | Prior 12 Months | Type of sales to include: Retail sales Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
No | ||
| Mississippi | 9/1/2018 | Monetary: $250,000 Transaction: N/A | Prior 12 Months | Type of sales to include: Total sales Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
No | ||
| Missouri | 1/1/2023 | Monetary: $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: All sales of tangible personal property Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
|||
| Nebraska | 4/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Retail sales Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
Yes | ||
| Nevada | 10/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Retail sales Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
Yes | ||
| New Jersey | 11/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Gross revenue from sales of tangible personal property, specified digital products, or taxable services Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| New Mexico | 7/1/2019 | Monetary: $100,000 Transaction: N/A | Previous calendar year | Type of sales to include: Taxable gross receipts Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Exclude |
Yes | ||
| New York | 6/21/2018 | Monetary: 6/21/2018 $300,000 6/24/2019 $500,000 AND Transaction: 100 | Prior four quarters
|
Type of sales to include: Sales of TPP Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
Yes | ||
| North Carolina | 11/1/2018 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar yea | Type of sales to include: All sales of TPP, digital property, and services Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| North Dakota | 10/1/2018 | Monetary: $100,000 Transaction: 2018 200 2019 N/A | Previous or current calendar yea | Type of sales to include: The sales of TPP and other taxable items delivered in this state Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Exclude |
No | ||
| Ohio | 8/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar yea | Type of sales to include: Retail sales Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
No | ||
| Oklahoma | 7/1/2018 | Monetary: 7/1/2018 $10,000 11/1/2019 $100,00 Transaction: N/A | Previous calendar year | Type of sales to include: Taxable sales Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Exclude |
No | ||
| Pennsylvania | 7/1/2019 | Monetary: $100,000 Transaction: N/A | Previous Pennsylvania fiscal calendar year – beginning on April 1st | Type of sales to include: Gross sales Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
No | ||
| Rhode Island | 7/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous calendar year | Type of sales to include: Gross revenue from the sale of TPP, prewritten computer software delivered electronically or by load and leave, vendor-hosted prewritten computer software, and/or taxable services delivered into the state Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| South Carolina | 11/1/2018 | Monetary: $100,000 Transaction: N/A | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| South Dakota | 11/1/2018 | Monetary: $100,000 OR Transaction: 200 (Transaction threshold to be removed 7/1/23) | Previous or current calendar year | Type of sales to include: Gross sales of TPP, any products or services transferred electronically Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Tennessee | 7/1/2019 | Monetary: 10/1/2019 $500,000 10/1/2020 $100,000 Transaction: N/A | Prior 12 months | Type of sales to include: Retail sales Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Include |
No | ||
| Texas | 10/1/2019 | Monetary: $500,000 Transaction: N/A | Prior 12 months | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Utah | 1/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Exclude Sales for resale: Include Exempt sales: Include |
No | ||
| Vermont | 7/1/2018 | Monetary: $100,000 OR Transaction: 200 | Prior 12 months | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Virginia | 7/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous or current calendar year | Type of sales to include: Retail sales Sales through a marketplace: Exclude Sales for resale: Exclude Exempt sales: Include |
No | ||
| Washington | 10/1/2018 | Monetary: $100,000 Transaction: 2018 200 2020 N/A | Previous or current calendar year | Type of sales to include: Retail sales Sales through a marketplace: Include Sales for resale: Exclude Exempt sales: Include |
No | ||
| West Virginia | 1/1/2019 | Monetary: $100,000 OR Transaction: 200 | Previous calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Wisconsin | 10/1/2018 | Monetary: $100,000 Transaction: 10/1/2018 200 2/20/2021 N/A | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
| Wyoming | 2/1/2019 | Monetary: $100,000 OR Transaction: 2/1/2019 200 7/1/2024 N/A | Previous or current calendar year | Type of sales to include: Gross sales Sales through a marketplace: Include Sales for resale: Include Exempt sales: Include |
No | ||
