Sales tax nexus in the United States may trigger your obligation to collect and pay sales and use taxes in the United States!

As opposed to Canada, there is no federal-level sales tax in the United States. Each state in the United States has its own sales tax rate, and some local counties and municipalities levy some sales and use tax for the goods or services consumed.

With the evolution of online sellers and e-commerce businesses, it has become difficult for the state to collect sales and use tax in the United States. After a famous court decision in the case of Wayfair involving the collection of sales tax by the state, most of the states in the United States has implemented the nexus rues.

Sales tax nexus is a term used in the United States to describe the connection between a business and a state that triggers a sales tax obligation. Sales tax nexus can be established by various activities or factors, including:

1 - Physical presence: A business has sales tax nexus in a state if it has a physical presence in that state, such as a store, office, warehouse, or employees working in that state.
2 - Economic presence: A business can also establish sales tax nexus in a state based on its economic activity in that state, such as reaching a certain sales threshold or having a certain amount of sales or transactions in that state.
3 - Affiliate or agent presence: A business can also have sales tax nexus in a state if it has affiliates or agents in that state who sell its products or services.

Once a business has established a sales tax nexus in a state, it is required to register for a sales tax permit with that state and collect and remit sales tax on all taxable sales made in that state. Failure to register and collect sales tax can result in penalties and interest charges.

It's important for businesses to understand the rules and regulations regarding sales tax nexus in each state where they do business, as the rules can vary depending on the state and the type of business activities involved. Businesses can consult with a tax professional or use online resources to determine their sales tax obligations and comply with the applicable laws.