Blog Posts

5 Business Activities that Create a Sales Tax Nexus

5 Surprising Business Activities that Create a Sales Tax Nexus

February 12, 2015

In most cases, a business needs to collect sales tax in the states in which they are located. This concept, called nexus, means that if the business has a physical presence in a state, that state can compel the business to collect sales tax from its customers. Nexus is pretty cut-and-dry when you’re thinking about the place where you work, or your business headquarters. If you’re a brick-and-mortar store with a single location, this is pretty straightforward. Everyone who comes into your store should pay your local sales tax rate on purchases (not accounting for topics like exempt sales and… Read More

Affiliate Programs and Sales Tax Law

April 21, 2014

With the growth of blogs and social media, affiliate programs are gaining popularity as additional income for the average person. They are also a great way for an online business to build brand recognition and spread the word about promotions and products nationwide. Unfortunately, having an affiliate program run across the U.S. can make a company subject to the changing complexity of nexus sales tax laws, since many states view such programs as “having a presence” in the state. How can a small company protect itself from getting mired in affiliate nexus tax laws but still offer an affiliate program?… Read More

Understanding Sales Tax Nexus

March 11, 2014

All this talk about nexus can be confusing for an online vendor. What exactly does it mean and who determines it? “Nexus” is a term used to designate that a company legally has a presence in that state – that is, they are determined to be doing business in the state. When nexus is created for a company, they are subject to that state’s sales tax requirements. While there are constitutional guidelines on how states can define it, states ultimately determine when nexus is established by a company. The standards vary greatly. Some of the ways nexus can be created… Read More

Holidays, Sales Tax and Shopping Online

December 9, 2013

This holiday season, lots of shoppers will be staying home to do their purchases. With more options for shipping and convenient delivery, and extra bargains, e-commerce store owners and site developers should provide their customers with tools that can help them navigate the confusion of online shopping. One reason shoppers may be hesitant to do heavy Christmas shopping at an online vendor is that they are uncertain what the sales tax will add to their bill and if, in fact, they even need to pay any. In addition, some vendors are confused themselves and may be breaking the law by… Read More

Destination and Origin Based Sales Tax

July 1, 2011

The term “sales tax sourcing” is used to describe which tax rates are applied to a given purchase, and to which jurisdictions the tax money collected is owed. When you ship a product to another address, the knowledge of your tax rules becomes very important in both the sales tax calculation and when completing your tax returns.