We had a blast at the PROSPER Show two weeks ago, and we had the pleasure of speaking with a number of different eCommerce retailers from all over the country. Our team heard about your sales tax challenges, your concerns for how the landscape is changing, and what exactly Taxify by Sovos can do to help your business stay confident in your compliance.
With that in mind, we’re here to provide some guidance on these issues, as well as resources you can reference.
Nexus: What is it, and how does it apply to remote sellers?
Put simply, nexus is when a business has a sufficient physical presence in a state or local jurisdiction. Having nexus in a place typically means you have an obligation to collect and remit sales tax there. However, its reach has been hotly disputed as eCommerce continues to escalate in importance. States are trying to crack down on remote sellers who either sell to their residents or store inventory within their borders, culminating in a recent challenge by South Dakota being brought to the Supreme Court of the United States.
While the future implications of nexus are up in the air, eCommerce businesses are still on the hook for taxes they may owe under the current definition. Use our State Resource Map to stay on track with rates and requirements.
How do I choose where to register next?
This can be tricky. But, never fear: We put together a Guide to Sales Tax Penalties and Audit Risks for eCommerce Sellers! Download our free guide to learn about when and where you’re most likely to be audited, how you can avoid accumulating penalties and interest, and what steps you can take to gain some peace of mind.
Why is Rhode Island asking for my information, even though I have no stock there?
In 2017, Rhode Island passed a law requiring marketplace providers like Amazon to collect sales tax on third-party transactions they facilitated. As a result of this rule, Amazon has decided to submit marketplace vendor information to the Rhode Island Department of Revenue. This follows similar action in neighboring Massachusetts that went into effect earlier this year, and appears to be the start of a wider trend.
What does Taxify by Sovos do, and how can you help my business?
Taxify is the fastest way to comprehensive compliance for small-to-medium-sized Magento sellers. In seconds, sellers can enable Taxify to automatically calculate sales tax on every transaction using enterprise-grade rooftop-level accurate Sovos rates. All calculations are built into the monthly fee.
For more on how to find the right sales tax solution for your business, reach out to our partners at Sales Tax System. They’ll walk you through the process and help you identify the best fit for your needs.
Find out how Taxify by Sovos can help your business conquer compliance.