Sales tax is more complicated than ever, especially in a post-Wayfair world. And what’s worse is that everyone who says they’re simplifying sales tax is still leaving the hardest parts – and the liability – up to you. Don’t let sales tax compliance overwhelm you. Make the right decisions for your business so you can best manage compliance in a way that doesn’t overburden your finance team or put your business at risk of penalties and fees.

Of the 50 states, 45 (plus DC) charge a state-wide sales tax. Two of those states that have a state-wide sales tax, Missouri and Florida, have yet to adopt economic nexus standards set by the 2018 South Dakota v. Wayfair case. At least for now.

There’s always something changing in the world of tax, especially sales tax. And 2021 continues to prove that. Here’s a review of some of the recent changes and updates.

When you think about tax compliance, of any kind, the first thing that comes to mind is filing, or even the tax return itself. Compliance with sales tax goes way beyond that.

A contractor is generally defined as someone who provides improvements to real property on a lump sum contract basis. From a sales and use tax perspective, there isn’t much of a difference between a subcontractor and a prime or general contractor. 

Companies that sell digital products in the U.S. should know about a relatively new kind of tax – and tax obligation. 

This St. Patrick’s Day, don’t look to four-leaf clovers, pots of gold or leprechauns to bail you out of trouble with sales tax. If your company has a sales tax obligations and doesn’t have a process yet in place, plan for the risks of non-compliance.

TaxConnex is excited to report exciting growth coming out of 2020. While 2020 was full of chaos and trials, sales tax filings and returns did not stop, and we were able to continue to assist our clients and grow as a company in both employee size and revenue.  

Sales tax obligations regarding software and other technology-related solutions can often come down to location and definition. And the definition is potentially different depending on the location.

Four states recently took a closer look at how sales tax applies to technology-related solutions, one of the more confusing industries for complying with sales and use tax requirements.

Sales tax is more complicated than ever, especially in a post-Wayfair world. And what’s worse is that everyone who says they’re simplifying sales tax is still leaving the hardest parts – and the liability – up to you. In fact, a recent survey TaxConnex conducted through Porter Research found that the top sales tax worry of finance pros in 2021 was understanding changing nexus laws. 

There’s always something changing in the world of tax, especially sales tax. And 2021 is off to an especially busy start. Here’s a review of some of the recent changes and updates.

You may think that if you do not have physical or economic tax nexus in a state, you do not have any tax obligations. However, this may not be the case. You can still have obligations to the certain tax authorities in a state even where you do not have nexus and are not required to collect and remit sales tax in the state.  

The reason? Use tax. Specifically, consumer’s use tax.

Many industry experts believe that as state tax revenues continue to dry up from the economic shutdown and continuing pandemic, state sales tax audits are likely to increase sharply in the coming months. States are in the same boat as many businesses when it comes to the stress and financial strain that comes along with the pandemic, and an increase in audits would help states recoup lost revenue and minimize budget deficits.

Sales and use tax obligations are determined by your nexus within a state or jurisdiction. Sales and use tax nexus is defined as the connection between a person or entity and a taxing jurisdiction. It is the basis for all your sales tax decisions because without sales tax nexus, you have no further sales tax obligation to a state.

Candy, flowers, jewelry, dinners: The gifts may be the same, but Cupid’s arrow will fly in new online directions this year for Valentine’s Day presents. And it might land right on your company’s bottom line after sales and use tax obligations.