Do I Need to Collect Sales Tax on Web Sales?
Question: I have online stores. Do I need to collect sales tax on web sales?
Answer: It used to be that you only had to collect sales tax in other states if you had some sort of presence or “nexus” in that state. Everything changed with the Supreme Court decision South Dakota v. Wayfair Inc. in June 2018. Once that decision takes effect over the next year or two, sales taxes will need to be collected for internet sales based on the sales tax laws of those locations. Needless to say, it is complicated.
I am advising my clients to consult with a sales tax adviser to make sure you are in compliance. There are a few such tax service companies operating now, and I expect more will be coming soon.
I am not a CPA nor a sales tax advisor, but I want you to be aware of the liability looming around the corner and seek professional advice on this issue to be sure you are in compliance. Don’t assume that things are the way they used to be.
Please email accounting questions you would like considered for the column to HGatter@AccountingSupportLLC.com with the subject line of "Ask the Accountant."
Harriet Gatter, owner of Accounting Support LLC, was an ad specialty distributor for 23 years and an adjunct professor of accounting at Neumann University. She sold her ad specialty business in 2012, became certified as a QuickBooks ProAdvisor, and now works exclusively with ad specialty distributors nationwide on their QuickBooks, order management and accounting needs.