Is my client required to collect sales tax on out-of-state sales?

If your client is selling products or services to out-of-state customers, the physical and economic nexus thresholds for each state where these sales occur should be examined to determine your client is required to collect register.

A few key factors in determining physical or economic nexus on out-of-state sales include, but is not limited to:

  1. States in which the business sells
  2. The nexus threshold in each state
  3. The company’s gross revenue and/or number of transactions in each state
  4. Employees in the state
  5. Personnel traveling to these states
  6. Third parties performing certain activities in the state on your behalf
  7. Property in these state

Davis Davis & Harmon LLC are sales tax audit specialists who can help you navigate your organization’s most complex sales and use tax issues. Our award-winning team will ensure your business is properly protected from over-taxation. Our goal is to maximize your sales tax savings and return money to your company’s bottom line. Contact DDH Tax today.

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This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific advice.

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