Sales and Use Tax Compliance in 2019 = A Happier New Year

Mapping the sales and use tax compliance maze

The year 2018 was a banner year for major law and administrative changes in sales and use tax compliance. In addition to the numerous changes in sales and use tax rates, rules and holidays, the Supreme Court on June 21, 2018, in Wayfair v South Dakota, changed the game in sales and use tax compliance in a major way. This monumental ruling expanded the reach (so-called nexus) of states to impose sales and use tax collection and remittance obligations on all retailers.

Online retailers particularly effected

In particular, this ruling had a pronounced effect on those retailers that sell online, so-called remote sellers.  Where once physical presence in a state was the only way that a retail business could be subject to the sales and use tax jurisdiction of the states, now “mere” economic presence is also enough to impose such liability on businesses.  This is called economic nexus.

More states are conforming in 2019

Many states have already enacted these economic nexus laws, and it is expected that by the end of 2019 all states will have such laws. This means that businesses in 2019 will feel the full impact of the Wayfair decision. In turn, this will present major challenges for businesses to stay sales and use tax compliant, not just in states where they have physical presence, as in the past, but now where they have economic presence—states in which businesses meet certain minimum threshold amounts in both amount of sales and/or number of transactions.

How can we help?

Wolters Kluwer is ready to help you better understand the nuances of sales and use tax compliance. Take advantage of our Year End Publication Sale. Enter promo code 30OFFTN to SAVE 30% on all the latest editions including: the U.S. Master Sales and Use Tax Guide or the Sales and Use Tax Answer Book.

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AUTHOR

Jerome Nestor

Jerome Nestor, Esq., CPA, MBA-Accounting Information Systems Manager Tax & Accounting North America Wolters Kluwer Mobile: +1 847.312.5671 Email: jerry.nestor@wolterskluwer.com

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