Economic Nexus: Collecting Sales Taxes in Other States
This article was last edited on 02/17/2020. For updated information on state sales tax and economic nexus, visit the state’s revenue department.
If you sell products online or otherwise sell to multiple states, you may have to start collecting sales tax in more places. Because of the South Dakota v. Wayfair Supreme Court case, states can now collect sales tax from you if you have economic nexus.
What’s economic nexus?
Before the South Dakota ruling, you only had to collect sales tax you had physical nexus – a physical presence in the state. Physical nexus includes having an employee who lives there or a warehouse full of inventory there.
Economic nexus, on the other hand, means that you have some sort of financial presence in the state. States that are starting to adopt this typically have a threshold for how much revenue you earn or how many transactions you have in the state before collecting sales tax.
Some states have “Notice and Reporting” laws on the books. When you meet those thresholds, you’ll either have to collect sales tax or provide sales reporting to the state and your customers so they can pay any taxes they owe.
Read also: How Do I Handle Sales Taxes?
State economic nexus laws
Most states now require you to collect sales tax if you have economic nexus. Keep reading to learn the necessary threshold(s) to collect sales tax in each state.
| State | Revenue in state | Transactions into state | Notes |
| Alabama | $250,000 in the previous calendar year | Collect and remit taxes if you met the threshold requirement in the previous calendar year | |
| Arizona | $150,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Arkansas | $100,000 in gross revenue | 200 or more | Collect and remit taxes if you met either requirement in the previous calendar year |
| California | $500,000 in gross revenue | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Colorado | $100,000 in gross revenue | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Connecticut | $100,000 in gross receipts | 200 or more | Must meet both thresholds in the previous 12 months before collecting and remitting sales taxes |
| Georgia | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Hawaii | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Idaho | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Illinois | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous 12 months |
| Indiana | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Iowa | $100,000 in gross revenue | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Kansas | Any | Any | Collect and remit taxes if you made any sales in Kansas |
| Kentucky | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Louisiana | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Maine | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Maryland | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Massachusetts | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Michigan | $100,000 in gross revenue | 200 or more | Collect and remit taxes if you met either requirement in the previous calendar year |
| Minnesota | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous 12 months |
| Mississippi | $250,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous 12 months | |
| Nebraska | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Nevada | $100,000 in gross revenue | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| New Jersey | $100,000 in sales | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| New Mexico | $100,000 in gross revenue | Collect and remit taxes if you met the threshold requirement in the previous calendar year | |
| New York | $500,000 in gross revenue | more than 100 | Must meet both thresholds in the last four quarters before collecting and remitting sales taxes |
| North Carolina | $100,000 in gross revenue | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| North Dakota | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| Ohio | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Oklahoma | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous 12 months | |
| Pennsylvania | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous 12 months | |
| Rhode Island | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in a calendar year |
| South Carolina | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| South Dakota | $100,000 in sales | more than 200 | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Tennessee | $500,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous 12 months | |
| Texas | more than $500,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous calendar year | |
| Utah | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Vermont | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Virginia | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Washington | $100,000 in sales | Collect and remit taxes if you met the threshold requirement in the previous or current calendar year | |
| West Virginia | $100,000 in gross revenue | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Wisconsin | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
| Wyoming | $100,000 in sales | 200 or more | Collect and remit taxes if you met either requirement in the previous or current calendar year |
