Sales tax law in the USA is subject to frequent changes, which can impact businesses. Keeping up with updates is important for maintaining compliance and avoiding penalties.
How to stay informed about tax law updates
State Department of Revenue Websites: Each state’s Department of Revenue or equivalent agency provides updates on changes to tax laws, rates, and regulations. These websites often have dedicated sections for news, bulletins, and notices.
Notices from the Department of Revenue (DOR): Read all notices sent to you by the DOR to review if any updates apply to your business now or in the future.
Recent Examples of Sales Tax Law Updates
Economic nexus: Following the 2018 Supreme Court decision in South Dakota v. Wayfair, Inc., many states have enacted economic nexus laws. These laws require out-of-state sellers to collect sales tax if their sales into the state exceed certain thresholds (e.g., $100,000 in sales or 200 transactions).
Marketplace facilitator: States have passed laws requiring marketplace facilitators (such as Amazon and eBay) to collect and remit sales tax on behalf of third-party sellers using their platforms. This simplifies compliance for individual sellers but adds obligations for marketplaces.
Overall, tax law updates happen at infrequent intervals throughout the year in the USA. It’s imperative that your business stays up to date with this information by ensuring you have a preferred method of receiving your notices or assigning someone responsible for reviewing all notices in your team. If you aren’t sure whether a new tax law applies to your business or not, our team is happy to help ease any questions you may have!
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