Many businesses are unaware that they may be failing to pay a state’s sales and use tax, believing they are not required to pay in states where they have no physical presence, only to be hit with violation notices and fees when it is too late. This phenomenon is not uncommon. Recent case law has changed the landscape of sales and use taxes, and it has become far too easy to fall into delinquency.
So what changed? On June 21, 2018, The United States Supreme Court ruled in South Dakota v. Wayfair that states can mandate that businesses without a physical presence in a state with more than 200 transactions or $100,000 in-state sales collect and remit sales taxes on transactions in the state. Since the decision was handed down by the Court, states and retailers alike have been asking “What’s next?”
Since Wayfair, most (but not all) states have adopted new rules defining what establishes a sales and use tax obligation, known as nexus. Unfortunately for businesses, no two state sales tax nexus laws are alike.
We began by investigating sales and use tax requirements for every state our clients did business in. After creating a chart identifying state requirements, we then looked into local tax regulations as well. After researching these percentages, we made sure our clients complied with the state and local sales and use tax requirements, avoiding costly penalties that could delay business flow. We further made it a point to stay updated on tax laws, as they are constantly evolving and changing. We even identified slight miscalculations in many popular software programs designed to track sale and use tax, ensuring nothing fell through the cracks for our clients.
As a result of our proactive approach, our clients stay in compliance with sales and use tax regulations, even as they continue to be updated. As a new and evolving area of law, it is difficult for many businesses to stay on top of the ever-changing requirements. Let us take the compliance burden from you so you can run your business.