Nexus Analysis
Multi-State Taxation – A Growing Concern
With the issue of multi-state taxation becoming a growing concern, your company needs to determine if it has a legal presence within Texas and other taxing jurisdictions. With nexus analysis services, we provide help with the complex and confusing laws regarding economic nexus sales tax and other nexus forms. If you are not a Texas company but you are making any sales into Texas, including labor, you MUST be concerned with nexus. This is also true of many other taxing jurisdictions. If you have agents, property, or make deliveries into a taxing jurisdiction where you do not have operations, a nexus analysis can determine if you’re required to collect and remit sales and use tax.
Capabilities
Proven Results
What Nexus Really Means
Nexus is the legal connection that gives a state the right to require your business to register, collect, and remit sales and use tax. Years ago, “connection” often meant a physical footprint. Today, it can also be triggered by sales volume alone. Between e-commerce growth, remote employees, and the Wayfair decision, multi-state taxation has become a moving target – especially for businesses that sell or ship across state lines. Thresholds differ from state to state, sometimes wildly – that’s why nexus analysis matters.
Common Nexus Triggers
Nexus can be created in more ways than most businesses expect, including:
- Having employees, contractors, or service technicians working in-state
- Owning or storing inventory, equipment, or other property in a state
- Meeting economic activity thresholds based on sales or transaction counts (economic nexus sales tax)
- Using agents, installers, or other representatives in-state
- Making deliveries using company vehicles or regular in-state drop-offs
How DDH Helps With Nexus Analysis Services
DDH approaches nexus analysis the way a teaching firm should: start with the facts, map them to state rules, then explain the “so what” in plain language. A thorough nexus analysis gives a clear picture of your exposure, what needs to be fixed, and what can wait. The process typically includes:
- Reviewing your sales channels, shipping patterns, and where work is performed
- Identifying likely nexus states and validating triggers (physical and economic)
- Estimating exposure periods and prioritising next steps
- Recommending a path forward, such as registration, remediation, or voluntary disclosure
Why Businesses Choose DDH
Beyond issues like economic nexus sales tax, DDH has focused on general sales tax work and helped businesses navigate these issues since 2001.
The team includes former Big 4 consultants and former state auditors who know nexus analysis, audit procedures, and how documentation holds up under review. DDH is an award-winning firm, and they stay in their lane: no IRS matters, no personal income tax – just sales and use tax.
Clients also appreciate the steady, human approach when the stakes feel high.
Next Steps
If nexus questions are keeping you up at night, you don’t have to sort it out alone. Submit the contact form to tell us what’s going on, or call 972-488-5000 to talk with a tax expert. Even a short conversation can help you understand where you stand and our nexus analysis services can help you.
Quick Nexus Analysis FAQ
What’s the difference between physical nexus and economic nexus?
Physical nexus comes from tangible presence: employees, inventory, or equipment in a state. Economic nexus is triggered by sales volume or transaction counts alone. Many businesses have economic nexus sales tax in states they’ve never set foot in. Both create the same obligation: register, collect, remit.
How do I know if my business has nexus in multiple states?
Start here:
- Where do you ship products or deliver services?
- Do employees, contractors, or reps work in other states?
- Have you crossed any state’s sales threshold?
If any answer is “yes” or “maybe”… professional nexus analysis is probably needed.
What happens if I’ve had nexus but haven’t been collecting tax?
It happens more than you’d think. The good news: there are paths forward – voluntary disclosure agreements, remediation planning, phased registration. DDH helps businesses sort through exposure, prioritize states, and move toward compliance without unnecessary panic.
Does remote work create nexus for my company?
It can. One employee working from their apartment in another state might be enough to trigger physical nexus there. Post-pandemic, this catches a lot of businesses off guard. Worth looking into nexus analysis services if your team is distributed, even partially.
Why should I get nexus analysis from a sales tax consulting firm instead of handling nexus myself?
You could research it yourself. But state rules vary wildly, thresholds shift, and the details matter. A firm like DDH:
- Knows how auditors think
- Can estimate exposure realistically
- Helps you avoid overcorrecting (or undercorrecting)
