Anniversaries are normally celebrated, except when it marks a decision that no eCommerce brand wanted to see, Wayfair vs. South Dakota. We are just past the two-year anniversary of the seismic change that forced eCommerce businesses to collect, report and remit sales tax under a blizzard of differing regulations.
So, what is the state of market compliance? Most would say, confused.
The basics are still the same:
- Review your sales by state
- Read the regulations
- Determine which of your products are taxable and where you have Nexus
- Register with the states(s) where you have met the nexus threshold to collect taxes
- Collect, report and remit your taxes
That’s sounds simple, but maybe not.
Just to make things more complicated, the pandemic has forced brands to change the way they work and unfortunately, some have been closed for weeks. But that does not mean that your obligation to deal with nexus issues has been on holiday. In fact, with the economic turmoil every state has faced, it makes it more likely that the “tax holiday” you have enjoyed is ending as states close revenue gaps by, you guessed it, collecting taxes. For a great explanation of everything sales tax nexus read this.
If you have been running under the radar waiting for states to contact you, think again. It is expected that states will become more aggressive in pursuing remote sellers and that could mean you will be getting a call very soon. For thoughts on the end of the grace period you can learn more here.
Our recommendations:
Review your sales records, determine your nexus responsibility and develop a plan to comply, do this today.
If you decide that you can handle filing for all your nexus’, then you will need tax tables. If you have multiple nexus and need help to automate the filing process, take a look at our solutions.
We have two great options and one includes our partner TaxJar, for their thoughts on the anniversary read this.
Whatever you do, don’t delay, nobody likes a visit from the taxman.
We invite your comments and feedback.
Image courtesy of StockSnap.io|Wilfred Iven
