Many SEMA member manufacturers, distributors and retailers have been impacted by the 2018 U.S. Supreme Court Wayfair decision that allows states to require sales tax collections based solely on the volume of sales into that state (economic nexus). The Court overturned its 1992 Quill decision, which previously required a company to have a physical presence before it could be compelled to collect sales tax.
SEMA has compiled resources (below) to help companies understand whether Wayfair impacts their business and provide additional information to help them respond if necessary.
Cash-strapped states have quickly implemented their new authority to require tax collection. Nearly all 45 states that collect sales tax have updated their regulations accordingly. There is no one national standard. Rather, each state is setting minimum dollar thresholds that trigger collection. In some states, that threshold may also be tied to the number of sales transactions—for example, $100,000 in sales or 200 transactions annually into that state.
- SEMA News Article (Aug. 2019): Most States Now Require Remote Sellers to Collect Sales Tax
- Webinar: State Sales Taxes: Understanding How Wayfair Impacts Your Company (Oct. 17, 2019)
Anna Ferraro, CPA with the accounting firm Moss Adams explains how Wayfair may impact SEMA member companies with remote sales or drop shipments. Issues covered include: Does your company already have a physical presence in the state? If so, why shouldn't your company quickly register to pay sales tax? How do you register with the state? How do you remit taxes? What are some tax software options?
- Tax Rates & Educational Tools: The Sales Tax Institute provides a wide range of online tools and educational material on sales and use taxes, drop shipments and other issues. The website also tracks the most recent updates to state tax rates and regulations.
- Sample Tax Software Providers: [alphabetical order]
Immediate questions? Contact Stuart Gosswein at firstname.lastname@example.org
Disclaimer: The material posted on this site is intended for reference only. The information, including state tax rates and regulations, are subject to change. SEMA has relied upon several federal and state resources to collect the material but disclaims any responsibility for the contents. SEMA also disclaims any responsibility for any claims that might result from reliance on the contents of the posted material. These materials are not intended to provide legal advice. SEMA recommends that companies consult their accountant or tax professional for additional information on this topic.