A State-by-State Guide to Economic Nexus

Economic Nexus

The Supreme Court ruling on the South Dakota v. Wayfair case in 2018 changed how out-of-state retailers collect and remit sales taxes in each state. At a minimum, states can mandate that businesses without a physical presence in a state and with more than 200 transactions or $100,000 in-state sales can be required to collect and remit sales taxes to the state where the goods are purchased.

Because sales tax regulations vary by state, each state has its own rules, registration process, and tax rate for out-of-state retailers that reach economic nexus in that state. In most cases, when a remote seller or marketplace facilitator without a physical presence in a state has “nexus” in that state, it must obtain a seller’s permit and collect and remit the state’s sales tax on each taxable purchase.

Nearly every state has enacted nexus laws that affect remote sellers. Below is a state-by-state guide to the economic thresholds and rules established for out-of-state sellers and marketplace facilitators.

Nexus Guide With Legal Statue

Income Nexus

If you have employees working and/or residing in another state, then you have income nexus in that state. Nexus occurs when your employee conducts work in a different state, whether or not the employee resides in that state. As an employer, you must comply with the other state’s payroll tax regulations.

To better understand the laws in each state and the tax guidance for determining taxation, we’ve included each state’s income/payroll tax rates. These rules may also ply to employees who work in multiple states or travel for work, so it’s smart to know how each state manages payroll taxes. Most businesses hire an expert to handle registration and payroll regulations to stay compliant.

In addition, many states have reciprocal agreements with other states, so make sure you know which states participate. For example, Arizona has reciprocal taxation agreements with California, Indiana, Oregon, and Virginia. Therefore, residents in these states who conduct business in Arizona can request an exemption from income tax withholding in Arizona.

Our State-by-State Guide for Managing Nexus

Alabama

Alabama Economic Nexus

Alabama requires all remote sellers and marketplace facilitators to collect and remit sales and use taxes to the State of Alabama.

What Does Alabama Require of Remote Sellers?

  • A business selling a product or service subject to Alabama’s remote seller’s rule must apply for a license through the Alabama Department of Revenue (ALDOR). (Depending on the business, additional business/occupational licenses may be required.)
  • Remote sellers and marketplace facilitators meeting the sales threshold can register for the Simplified Sellers Use Tax (SSUT) program.
  • The “Simplified Seller Use Tax Remittance Act” allows eligible sellers to participate in a program to collect, report and remit a flat 8% sellers use tax on all sales made in Alabama.
  • Remote sellers and marketplace facilitators apply for participation in the SSUT program by clicking on the “Obtain a new tax account” link on the My Alabama Taxes (MAT) website.
  • SSUT participants must file monthly returns and remit monthly payments through MAT.
  • Alabama’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Alabama customers and shipping products into the state.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Alabama?

  • All remote sellers directly selling over the $250,000 threshold of total retail sales delivered into Alabama the previous calendar year must collect and remit taxes on sales into Alabama.
  • Marketplace facilitators with Alabama marketplace sales of more than $250,000 must collect tax on sales made by or on behalf of its third-party sellers. Marketplace sellers do not need to collect tax on transactions when a marketplace facilitator is collecting and remitting for them.

What Are the Other Sales and Use Tax Requirements for Remote Sellers in Alabama?

  • Remote sellers must annually renew their Tax Account License.
  • Many localities apply their own additional sales taxes; however, participants in SSUT pay only the 8% flat tax regardless of the locality.
  • Failure to pay sales tax is a felony in Alabama. The penalty is up to a $10,000 fine and/or imprisonment for up to 5 years.

Alabama State Payroll Taxes

  • Alabama manages state payroll taxes through the Department of Revenue.
  • Alabama has a progressive income tax from 2% to 5%. Depending on where your employees live or work, some cities in Alabama also impose a levy on income taxes from 0% to 2%.
  • Alabama State Unemployment Insurance (SUI) varies by calendar year. 2022 rates range from 0.725% to 7.625%. New employers pay a flat rate of 2.7%.
  • Alabama does not offer state disability insurance.
  • Alabama employers must register with the Alabama Department of Revenue for state withholdings (payroll taxes) and the Alabama Department of Labor for unemployment taxes.
  • For more on income nexus, see Alabama Payroll Tax FAQs.

Alaska

Alaska Economic Nexus

Alaska requires remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Alaska.

What Does Alaska Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Alaska customers and shipping products into Alaska.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Alaska.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator. If the marketplace seller only sells in Alaska through a marketplace facilitator, the marketplace seller must file a Marketplace Seller Affidavit which then places the sales tax responsibility on the marketplace facilitator.

What is Economic Nexus in Alaska?

  • Remote sellers and marketplace facilitators that meet the statewide threshold of $100,000 gross sales or 200 individual transactions annually into Alaska this year (or the previous year) must register with ARSSTC.
  • To calculate the economic threshold, use all sales into Alaska, including marketplace facilitator sales, regardless of destination or taxability status of the end buyer.
  • Marketplace sellers do not need to collect tax on transactions when a marketplace facilitator is collecting and remitting for them.
  • Once a seller has met the economic threshold, they must register with the ARSSTC filing portal within 30 days.

What Are the Other Sales and Use Tax Requirements for Remote Sellers in Alaska?

  • Remote sellers must file sales taxes monthly unless agreed upon with the ARSSTC.
  • Remote sellers must file sales taxes, whether the taxes were collected or not.
  • All filings and taxes must be remitted electronically through the ARSSTC filing portal.
  • Sellers must notify the ARSSTC within 30 days of ceasing sales in Alaska or closing the business.
  • The penalty for failing to pay sales tax in Alaska depends on the municipality. For example, in Juneau, failure to pay constitutes a misdemeanor. A penalty of $25 for all late returns and a penalty of 5% per month (not to exceed a total penalty of 25%) is imposed in addition to interest at the rate of 10% per annum.

Alaska State Payroll Taxes

  • Alaska has no state income tax, so employers are not required to register for state payroll taxes.
  • Alaska employers are responsible for paying a varying unemployment tax rate of 1% to 5.4% on a taxable wage base of $45,200. New employers pay a flat tax of 3%. (Alaska’s UI tax rates fluctuate quarterly based on the employer’s gross payroll.)
  • Employees in Alaska also contribute to Unemployment Insurance. Employers are required to withhold 0.50% per employee on a taxable wage base of $45,200.
  • Alaska employers must register with the Alaska Department of Labor and Workforce Development to receive an Alaska Employer Security Tax Account Number. You must provide your account number when filing returns and making deposits in all electronic and paper filings.
  • For more on income nexus, see Alaska Payroll Tax FAQs.

Arizona

Arizona Economic Nexus

Arizona requires remote sellers and marketplace facilitators with economic nexus to file and pay transaction privilege tax (TPT).

What Does Arizona Require of Remote Sellers?

  • The Arizona Privilege Tax (sales tax) is the tax a vendor pays for the privilege of doing business in the state.
  • A business selling a product or service subject to Arizona’s TPT must apply for a license through the Arizona Department of Revenue (ADOR). (Depending on the business, additional business/occupational licenses may be required.)
  • The privilege tax is paid to the ADOR. Tax rates vary depending on the business, business’s activities, and the city and county where its located.
  • Arizona’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Arizona customers and shipping products into Arizona.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Arizona through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Arizona.

What is Economic Nexus in Arizona?

  • Remote sellers and marketplace facilitators must collect Arizona sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • Persons and businesses with economic nexus must pay the TPT.
  • Marketplace sellers do not need to collect TPT on transactions when a marketplace facilitator collects and remits TPT for them.
  • Failure to pay sales tax in Arizona is a class 5 felony.

Arizona State Payroll Taxes

  • Businesses must register with the Arizona Department of Revenue (ADOR) and the Arizona Department of Economic Security (DES) before conducting any taxable business activity in Arizona.
  • Arizona income taxes are broken into five brackets based on income, with rates ranging from 2.59% to 4.5%. Arizona will phase in a flat 2.5% tax by 2024.
  • Arizona employers pay Unemployment Insurance between 0.08% to 20.93% on the first $7,000 each employee earns. All new employers pay a flat rate of 2.0%.
  • For more on income nexus, see Arizona Payroll Tax FAQs.

Arkansas

Arkansas Economic Nexus

Arkansas requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Arkansas.

What does Arkansas require of remote sellers?

  • Remote sellers and marketplace facilitators selling a product or service subject to Arkansas’s sales and use taxes must register through the Arkansas Taxpayer Access Point (ATAP).
  • The Arkansas sales tax rate is 6.5%. Local cities and counties mandate additional sales taxes.
  • Remote sellers meeting economic nexus in Arkansas can register for sales and tax use in Arkansas directly through ATAP or register for multiple states through the Streamlined Sales Tax Registration System.
  • The Streamlined Sales Tax System allows remote sellers to submit one application to collect and remit sales and use taxes in 24 Streamlined member states.
  • See the Streamlined Sales Tax Governing Board for more information on Marketplace Sellers and Marketplace Facilitators registration in the Streamlined States.
  • Arkansas’ voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Arkansas customers and shipping products into Arkansas.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Arkansas through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Arkansas.

What is Economic Nexus in Arkansas?

  • Remote sellers and marketplace facilitators that meet the statewide threshold of $100,000 gross sales or 200 individual transactions annually into Arkansas this year (or the previous year) must register with the Arkansas Taxpayer Access Point.
  • To determine if your business has economic nexus in Arkansas, you can download and submit an Arkansas Economic Nexus questionnaire.
  • Remote sellers and marketplace facilitators must file and pay sales and use taxes monthly for any month they have sales in Arkansas.
  • Marketplace sellers do not need to collect sales and use taxes on transactions when a marketplace facilitator collects and remits for them.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Arkansas is a class D felony.

Arkansas State Payroll Taxes

  • Employers must register new employees with the Arkansas New Hire Reporting Center, the Arkansas Department of Finance and Administration, and the Department of Workforce Services.
  • Arkansas has a 2022 progressive income tax rate ranging from 2% to 5.5%, with various tax brackets.
  • Employers pay a varying unemployment tax rate of 0.3% to 14.2% on a taxable wage base of $10,000. New employers pay a flat tax of 3.1% (includes a 0.3% stabilization tax).
  • For more on income nexus, see Arkansas Payroll Tax FAQs.

California

California Economic Nexus

California requires all remote sellers and marketplace facilitators with economic nexus to register and remit sales tax to the State of California.

What Does California Require of Remote Sellers?

  • California’s Assembly Bill No. (AB) 147 requires retailers outside of California (remote sellers) to register with the California Department of Tax and Fee Administration (CDTFA) for a seller’s permit and to collect and submit taxes.
  • California’s statewide tax rate is 7.25%, plus any additional sales tax mandated by local districts. Add-on district tax rates range from 0.10% to 1.00%, and some areas may have more than one district tax. Sellers are responsible for collecting and paying the applicable district taxes.
  • The CDTFA designates the filing frequency (either monthly, quarterly, fiscal yearly, or calendar yearly) based on the seller or marketplace facilitator’s reported sales tax or anticipated taxable sales at the time of registration.
  • Unregistered remote sellers are encouraged to register under California’s Out-of-State Voluntary Disclosure Program. The program limits the time the CDTFA can assess overdue use tax to three years and allows the CDTFA to waive late filing or late payment penalties.

What is a Remote Seller?

A remote seller is an out-of-state seller with no physical presence in California. A physical presence includes an office, warehouse, storefront, inventory, service or sales agent, or equipment/tangible property rental.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to California.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in California?

  • Remote sellers and marketplace facilitators have economic nexus if, in the preceding or current calendar year, the total combined sales of tangible personal property for delivery in California by the seller and all persons related to the seller exceed $500,000.
  • CDTFA Form 758 Tax Matrix lists which items are subject to California sales tax.
  • Remote sellers include retailers selling tangible goods for delivery into California through the Internet, mail-order catalogs, telephone, or other means.
  • Failure to pay sales tax in California is a misdemeanor with a $1,000 to $5,000 fine and/or imprisonment for up to one year. The penalty is a felony if there is an intent to evade paying sales taxes and the unreported tax exceeds $25,000 in a 12-month period with a $5,000–$20,000 fine and/or imprisonment for 16 months to 3 years.

California State Payroll Taxes

  • If you operate a business, employ one or more employees, and pay wages of more than $100 in a calendar quarter in California, you must register as an employer with the EDD. Income tax rates range from 1%-13.3%.
  • Unemployment taxes range to 6.2% on the first $7,000 in wages. New employers pay 3.4%.
  • California manages four types of state payroll taxes through the EDD:
    • Employer Contributions:
      • Unemployment Insurance (UI)
      • Employment Training Tax (ETT) [Cost: 0.1%, a max of $7 per employee]
    • Withholdings from Employee Wages:
      • State Disability Insurance (SDI) [Cost: 1.1% of annual income up to $145,600]
      • Personal Income Tax (PIT)
    • For more on income nexus, see California Payroll Tax FAQs.

Colorado

Colorado Economic Nexus

Colorado requires all remote sellers and marketplace facilitators with economic nexus to register and remit sales tax to the State of Colorado.

What Does Colorado Require of Remote Sellers?

  • Remote sellers and marketplace facilitators with economic nexus must register and remit sales tax through Colorado’s Department of Revenue’s (CDOR) Out of State Retailer Registration.
  • Colorado’s statewide tax rate is 2.9%. Additional sales taxes are mandated by local cities, counties, and special districts. Sellers are responsible for collecting and paying the applicable taxes.
  • A person or business is also doing business in Colorado if the person or company solicits business and receives orders from Colorado residents by any means whatsoever. A solicitation may be done by direct or indirect representatives, manufacturers’ agents, catalog distribution, advertising, and media communication.
  • Colorado’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Colorado customers and shipping products into Colorado.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Colorado.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Colorado?

  • Remote sellers and marketplace facilitators must begin collecting Colorado sales tax if their retail sales into Colorado during the current calendar year exceed $100,000.
  • Remote sellers with annual sales under $100,000 are exempt from state sales tax licensing and collection. However, exempt remote sellers must notify their Colorado customers about their sales obligations and provide an Annual Purchase Summary to all Colorado purchasers and an Annual Customer Information Report to the CDOR. For more information, see the Colorado Sales Tax Guide.
  • Failure to pay sales tax in Colorado is a class 5 felony. The penalty is up to $100,000 ($500,000 for a corporation) and/or imprisonment.

Colorado State Payroll Taxes

  • All businesses employing workers residing in Colorado must register for payroll taxes and Unemployment Insurance.
  • Colorado manages state payroll taxes through the Colorado Department of Revenue (DOR) and Unemployment Insurance through the Department of Labor and Employment (DLE).
  • Employers withhold a flat income tax rate of 4.55%.
  • Colorado employers pay for Unemployment Insurance at a tax range of 0.75% to 10.39%. New employers start at 1.7%.
  • Five Colorado cities require employees and employers to pay an additional Occupational Privilege Tax (OPT)—Aurora, Denver, Glendale, Greenwood Village, and Sheridan. Each city sets its own flat rate based on a city-determined income threshold.
  • For more on income nexus, see Colorado Payroll Tax FAQs.

Connecticut

Connecticut Economic Nexus

Connecticut requires all remote sellers and marketplace facilitators with economic nexus to register and remit sales tax to the State of Connecticut.

What Does Connecticut Require of Remote Sellers?

  • Any person or company engaged in business in Connecticut must register with the DRS for a sales and use tax permit.
  • Remote sellers making retail sales of tangible personal property or services to a destination in Connecticut and with economic nexus must register with DRS and obtain a Connecticut Sales and Use Tax Permit.
  • To conduct business in Connecticut, remote sellers must create an account on the DRS online portal myconneCT.
  • Connecticut’s statewide tax rate is 6.35%. There are no additional local county or municipal sales taxes in Connecticut. Sellers are responsible for collecting and paying the applicable taxes.
  • Connecticut’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence in the state, making direct sales to Connecticut customers and shipping products into Connecticut.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Connecticut.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Connecticut?

  • Remote sellers must begin collecting Connecticut sales tax if their retail sales into Connecticut during the 12 months ending on September 30th equal at least $100,000 in gross receipts and have 200 or more retail sales into Connecticut.
  • Marketplace facilitators with retail sales of at least $250,000 by marketplace sellers during the 12 months ending September 30th must also register with DRS and obtain a sales and use tax permit.
  • When the remote seller or marketplace facilitator does not collect sales tax, the consumer must pay use tax on the transaction.
  • Failure to pay sales tax in Connecticut carries a penalty of up to a $1,000 fine and/or imprisonment for up to one year.

Connecticut State Payroll Taxes

  • Connecticut has a progressive income tax rate ranging from 3% to 6.99%.
  • Connecticut employers must pay an unemployment tax with rates ranging from 1.9% to 6.8% on a taxable wage base of $15,000. New employers pay 3% in 2022.
  • The Connecticut State Paid Family and Medical Leave Act (PFMLA) requires employers to withhold 0.5% of each employee’s taxable wages up to the Social Security contribution base ($147,000 in 2022).
  • For more on income nexus, see Connecticut Payroll Tax FAQs.

Delaware

Delaware Economic Nexus

Delaware requires all remote sellers and marketplace facilitators with economic nexus to register and remit sales tax with the State of Delaware.

What Does Delaware Require of Remote Sellers?

  • All persons and companies engaged in business in Delaware must register with the Delaware Division of Corporations.
  • Although Delaware has no state or local sales tax, remote sellers must acquire an annual business license.
  • Remote sellers may be subject to a gross receipts tax, which must be remitted monthly or quarterly, depending on the business activity.
  • To pay gross receipts tax, remote sellers and marketplace facilitators must create an account on the Delaware Taxpayer Portal.
  • Gross receipts tax rates range from .0945% to .7468%, depending on the business’s activity.
  • Most businesses are allowed an exclusion on the gross receipts tax. The exclusions start at $100,000 per month, depending on the business’s activity. See the Detailed List Division of Revenue Licenses and Tax Rates for exclusions and fees.
  • Gross receipts tax returns filed late are subject to a penalty of 5% per month, plus interest of 0.5% per month from the original due date until paid. An additional penalty of 1% per month (not to exceed 25%) is imposed for failure to pay (in whole or in part) the tax liability shown to be due on a timely filed return.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence in the state, making direct sales to Delaware customers and shipping products into Delaware.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Delaware.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Delaware?

To determine if your business has nexus and must pay the gross receipts tax in Delaware, you can download and submit a  Delaware nexus questionnaire.

Delaware State Payroll Taxes

  • Delaware has a progressive income tax rate ranging from 0% to 6.6%, with various tax brackets.
  • Employers with workers residing or conducting business in Wilmington, Delaware, must withhold a 1.25% Wilmington City Tax from employees’ wages.
  • Delaware employers pay a varying unemployment tax rate of 3% to 8.2% on a taxable wage base of $16,500. New employers pay a flat tax of 1.8%. New construction employers pay a flat 2.3%.
  • For more on income nexus, see Delaware Payroll Tax FAQs.

District of Columbia

District of Columbia Economic Nexus

The District of Columbia requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the District of Columbia Department of Revenue.

What Does the District of Columbia Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet the District of Columbia’s economic threshold must register and remit taxes through the District’s online tax portal, DC.gov.
  • The District of Columbia sales tax rate is 6%.
  • In most cases, the District of Columbia’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence in DC, making direct sales to District of Columbia customers and shipping products into the District of Columbia.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in the District of Columbia through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to the District of Columbia.

What is Economic Nexus in the District of Columbia?

  • Remote sellers and marketplace facilitators must collect District of Columbia sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from District of Columbia sales.
  • Failure to pay sales tax in the District of Columbia is a misdemeanor. The penalty can be up to a $5,000 fine and/or imprisonment for up to 180 days. It is considered a felony if the sales tax owed exceeds $10,000. The penalty is the greater of three times the tax owed or $10,000 and/or imprisonment for up to 10 years.

District of Columbia State Payroll Taxes

  • District of Columbia employers must register with the DC Office of Tax and Revenue and the DC Department of Employment Services.
  • The District of Columbia has six tax brackets with income tax rates ranging from 4% to 9.75%.
  • Employers pay an unemployment tax with rates ranging from 1.9% to 7.4% on a taxable wage base of $9,000. New employers pay a flat 2.7% in 2022.
  • For more on income nexus, see District of Columbia Payroll Tax FAQs.

Florida

Florida Economic Nexus

Florida requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Florida.

What Does Florida Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that make a “substantial number of remote sales” into Florida must register on the Florida Department of Revenue Tax Application portal.
  • In Florida, a “remote sale” is described as “the retail sale of tangible personal property ordered by mail, telephone, the internet, or other communication, from a person who receives the order outside Florida and causes the property to be transported into Florida.”
  • Florida’s general state sales tax rate is 6%, with some exceptions (4% on amusement machine receipts, 5.5% on the lease or license of commercial real property, and 6.95% on electricity).
  • In addition, remote sellers must collect and remit applicable discretionary sales surtax when delivering tangible personal property to counties with a surtax. The discretionary sales surtax rates range from .5% to 1.5%. For a complete list, see the Discretionary Sales Surtax
  • In most cases, Florida’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Florida customers and shipping products into Florida.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Florida.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Florida?

  • Florida deems a “substantial number of remote sales” as any number of taxable remote sales into Florida in the previous calendar year that exceed $100,000.
  • Examples of remote sales in Florida include:
    • Internet purchases
    • Mail-order catalog purchases
    • International purchases
    • Out-of-state furniture purchases
    • Out-of-state computer equipment purchases
  • Marketplace providers must electronically register to collect and remit sales and use taxes on taxable sales facilitated on behalf of marketplace sellers for delivery into Florida.
  • Failure to pay sales tax in Florida is a misdemeanor if it is a first or second offense involving less than $300. After the second offense, the penalty is a first-, second-, or third-degree felony, depending on the amount of tax involved.

Florida State Payroll Taxes

  • Employers in Florida must register with the Florida Department of Revenue to pay reemployment taxes.
  • Like Unemployment Insurance, the reemployment tax provides temporary income to workers who lose their jobs through no fault of their own and are able and available for work. New employers pay the initial rate of .0270 (2.7%) and continue at that rate for 10 quarters. After 10 quarters, employers’ rates range from 0.10% (or $7.00) to 5.4% (or $378) per employee.
  • For more on income nexus, see Florida Payroll Tax FAQs.

Georgia

Georgia Economic Nexus

Georgia requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales tax to the State of Georgia.

What Does Georgia Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that have economic nexus in Georgia must register to pay sales taxes through the Department of Revenue’s Georgia Tax Center portal.
  • Sellers in Georgia must obtain a sales and use tax number and certificate of registration whether sales are online, out of state, wholesale, or exempt from tax.
  • Georgia’s general state sales tax rate is 4%. Some local Georgia municipalities charge an additional sale tax. Sellers are responsible for collecting and paying the applicable taxes.
  • In Georgia, remote sales refer to “conducting retail sales of tangible personal property to be delivered electronically or physically to a location within [Georgia] to be used, consumed, distributed, or stored for use or consumption in [Georgia].
  • Georgia’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence in the state that makes direct sales to Georgia customers and ships products into Georgia.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Georgia.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Georgia?

  • Economic nexus is triggered for remote sellers in Georgia when gross revenues exceed $100,000 in the previous or current calendar year or the seller has conducted 200 or more separate retail sales transactions.
  • Economic nexus is triggered for a marketplace facilitator in Georgia when the total value of its taxable retail sales sourced to Georgia equals or exceeds $100,000 in the previous or current calendar year.
  • Failure to pay sales tax in Georgia is a misdemeanor. The penalty is up to a $5,000 fine and/or imprisonment for up to one year. A subsequent offense is a felony with up to a $10,000 fine and/or imprisonment for up to 5 years.

Georgia State Payroll Taxes

  • All Georgia employers must register with the Georgia Department of Revenue and Georgia Department of Labor.
  • Georgia has a progressive income tax rate ranging from 1% to 5.75%.
  • Employers pay an unemployment tax on a wage base of $9,500. Rates range from 0.04% to 8.1%. New employers pay a flat rate of 2.7%.

For more on income nexus, see Georgia Payroll Tax FAQs.

Hawaii

Hawaii Economic Nexus

Hawaii requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales tax to the State of Hawaii.

What Does Hawaii Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that have economic nexus in Hawaii must register to pay sales taxes through the Hawaii Department of Taxation’s Hawaii Tax Online (HTO)
  • Although Hawaii does not have a sales tax, business activities are subject to a General Excise Tax (GET). Sellers can obtain a GET license online at Hawaii Business Express.
  • Hawaii’s GET tax rate varies by activity—most activities are taxed at 0.5%, 4%, or 4.5%.
  • Sellers are not required to charge GET; however, it’s common for sellers to pass the GET tax along to their customers. If the seller does not collect the GET charge from the customer, the seller is responsible for remitting GET.
  • In addition, some Hawaii cities and counties have adopted a county surcharge on state GET. Sellers must also pay the county surcharge for sales made into those counties.
  • Hawaiians who purchase from out-of-state unlicensed sellers must pay a “use” tax. Hawaii deems use as keeping goods, intangibles, services, or contracting in Hawaii to resell or lease to others, for personal or business use, or for your own consumption. See the Department of Taxation’s Instructions for Filing the General Excise/Use Tax Returns for more information.
  • All marketplace facilitators and marketplace sellers engaged in business in the State of Hawaii must register for GET licenses before starting business activities.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence in the state, making direct sales to Hawaii customers and shipping products into Hawaii.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Hawaii.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Hawaii?

  • Economic nexus is triggered when taxpayers (including remote sellers, marketplace facilitators, and marketplace sellers) without a physical presence in Hawaii have gross revenues exceeding $100,000 in the previous or current calendar year, or the seller has conducted 200 or more separate retail sales transactions.
  • Remote sellers and marketplace facilitators must maintain a GET license, file GET returns, and remit GET to the Hawaii Department of Taxation.
  • Failure to pay sales tax in Hawaii is a class C felony. The penalty is up to $100,000 ($500,000 for a corporation), imprisonment for up to 5 years, and/or probation. Failure to remit use tax collected is considered embezzlement and subject to a fine of more than five times the amount not remitted or imprisonment for up to 10 years.

Hawaii State Payroll Taxes

  • Employers must register with the Hawaii Department of Taxation and the Department of Labor and Industrial Relations.
  • Hawaii has a progressive income tax rate ranging from 1.4% to 11%, with various tax brackets.
  • Employers pay a varying unemployment tax rate of 0.2% to 5.8%. New employers pay a flat rate of 3%.
  • Employers are required to pay an Employment and Training Assessment (E&T) fee of 0.01% of taxable wages.
  • For more on income nexus, see Hawaii Payroll Tax FAQs.

Idaho

Idaho Economic Nexus

Idaho requires people and businesses with economic nexus to register, collect, and remit sales tax with the State of Idaho.

What Does Idaho Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that have economic nexus in Idaho must obtain a seller’s permit through the Idaho Business Registration portal and pay sales tax through a Taxpayer Access Point (TAP) account.
  • Idaho’s current sales tax rate is 6%. Some municipalities charge an additional sales tax, called “local option” taxes.
  • Idahoans that purchase from out-of-state unlicensed sellers must pay a 6% “use” tax.
  • Idaho’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Idaho customers and shipping products into Idaho.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Idaho.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Idaho?

  • Economic nexus is triggered when the sales of an out-of-state seller, including any made through a marketplace facilitator, exceed $100,000 in the current or previous calendar year.
  • For marketplace facilitators, economic nexus is established when the combined total of sales in Idaho and third-party sales in Idaho exceeds $100,000 in the current or previous calendar year.
  • Failure to pay sales tax in Idaho is a felony. The penalty is up to a $10,000 fine and/or imprisonment for up to 5 years.

Idaho State Payroll Taxes

  • Idaho employers must register with the Idaho Department of Labor, the Idaho State Tax Commission, and the Idaho Industrial Commission.
  • Idaho has a progressive income tax rate ranging from 1.125% to 6.925%, with seven tax brackets.
  • Employers pay an unemployment tax with rates ranging from 0.207% to 5.4% on a taxable wage base of $43,000. New employers pay a flat 1%.
  • For more on income nexus, see Idaho Payroll Tax FAQs.

Illinois

Illinois Economic Nexus

Illinois requires remote sellers and marketplace facilitators that have economic nexus to register, charge, collect and remit sales tax with the State of Illinois.

What Does Illinois Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that have economic nexus in Illinois must obtain a seller’s permit through the Illinois Department of Revenue’s IDOR My Tax Illinois Remote sellers must register as a new business or an ST-1 account indicating general merchandise, retail, and out-of-state in the business activities section.
  • Illinois sales and use taxes are comprised of the Retailers’ Occupation Tax and Service Occupation Tax. The Retailers’ Occupation Tax Act imposes a tax upon persons selling tangible personal property at retail. The Service Occupation Tax imposes a tax on the sales of tangible personal property from a service provider.
  • Illinois’ general state sales and use tax rates are 6.25% on general merchandise and 1% on qualifying foods, drugs, and medical appliances. There are additional sales taxes in municipalities with a local surcharge.
  • ​The IDOR’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities (limited to a look-back period of four years) without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Illinois customers and shipping products into Illinois.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. The marketplace facilitator collects payment on the sales and remits the tax to Illinois.

What is a Marketplace Seller?

A marketplace seller is a person or business that makes sales through any physical or electronic marketplaces operated by a marketplace facilitator.

What is Economic Nexus in Illinois?

  • A remote seller or marketplace facilitator with no physical presence in Illinois meets the threshold for economic nexus with $100,000 or more in cumulative gross receipts from sales of tangible personal property to purchasers in Illinois; or with 200 or more separate transactions for the sale of tangible personal property to purchasers in Illinois.
  • Remote sellers and marketplace facilitators must determine quarterly, ending on the last day of March, June, September, and December, whether it meets or exceeds either threshold for the preceding 12-month period.
  • In Illinois, the criminal penalty for failing to pay sales tax is a class 4 felony. It’s a Class 3 felony if the tax due is $300 or more.

Illinois State Payroll Taxes

  • Employers must register with the Illinois Department of Employment Security and the Illinois Department of Revenue.
  • Illinois employers contribute a flat income tax rate of 4.95% per employee.
  • Employers are also responsible for withholding unemployment taxes in Illinois for employees earning over $12,960 in 2022 at a tax rate ranging from 0.725% to 7.625%. New employers pay 3.53%.
  • For more on income nexus, see Illinois Payroll Tax FAQs.

Indiana

Indiana Economic Nexus

Indiana requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Indiana.

What Does Indiana Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Indiana’s economic threshold must register a new business through Indiana’s INBiz online portal.
  • A business selling a product or service subject to Indiana’s sales and use taxes must register to file and pay tax electronically using INTIME.
  • The Indiana sales tax rate is 7%. There are no additional city or county sales taxes.
  • Remote sellers may also register for sales tax through Indiana’s Streamlined Sales Tax Registration System.
  • The Streamlined Sales Tax System allows remote sellers to submit one application to collect and remit sales and use taxes in 24 Streamlined member states.
  • See the Streamlined Sales Tax Governing Board for more information on Marketplace Sellers and Marketplace Facilitators registration in the Streamlined States.
  • Indiana’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities (limited to a look-back period of three years) without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Indiana customers and shipping products into Indiana.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Indiana through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Indiana.

What is Economic Nexus in Indiana?

  • Remote sellers and marketplace facilitators that meet the statewide threshold of $100,000 gross sales or 200 individual transactions annually into Indiana this year (or the previous year) must register with Indiana’s INBiz online portal.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Indiana is a class D felony.

Indiana State Payroll Taxes

  • All Indiana employers must register with the Indiana Department of Revenue and the Indiana Department of Workforce Development.
  • Indiana has a flat income tax rate of 3.23%.
  • All 92 counties in Indiana require additional tax withholding. The county tax applies to employees who are residents of the county and/or perform their principal business functions in the county. Rates vary by county.
  • Indiana employers pay an unemployment tax with rates ranging from 0.5% to 7.4% on a wage base of $9,500 per employee. New employers pay a flat rate of 2.5%.
  • For more on income nexus, see Indiana Payroll Tax FAQs.

Iowa

Iowa Economic Nexus

Iowa requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Iowa.

What Does Iowa Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Iowa customers and shipping products into Iowa.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Iowa through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Iowa.

What is Economic Nexus in Iowa?

  • Remote sellers and marketplace facilitators must collect Iowa sales tax only if the remote seller has $100,000 or more in gross revenue from Iowa sales.
  • Sellers that only sell products on a marketplace facilitator need not collect and remit Iowa sales tax, which is the facilitator’s responsibility.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Iowa is a Class D felony.

Iowa State Payroll Taxes

  • All Iowa employers must register with the Iowa Department of Revenue and the Iowa Workforce Development agency.
  • Iowa has a progressive income tax rate ranging from 3.1% to 8.53%, with various tax brackets.
  • Iowa employers pay a varying unemployment tax rate of 0% to 7.5% on a taxable wage base of $34,800. New employers pay a flat rate of 1%, new construction employers pay a flat 7.5%, and new government pays a flat 4.0%.
  • For more on income nexus, see Iowa Payroll Tax FAQs.

Kansas

Kansas Economic Nexus

Kansas requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Kansas.

What Does Kansas Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Kansas customers and shipping products into Kansas.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Kansas through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Kansas.

What is Economic Nexus in Kansas?

  • Remote sellers and marketplace facilitators must collect Kansas sales tax only if the remote seller has $100,000 or more in gross revenue from Kansas sales.
  • Sellers that only sell products through a marketplace facilitator need not collect and remit Kansas sales tax because it’s the facilitator’s responsibility.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Kansas is a $500 to $10,000 fine and/or imprisonment for 1 – 6 months.

Kansas State Payroll Taxes

  • All Kansas employers must register with the Kansas Department of Revenue and the Kansas Department of Labor.
  • Kansas has a progressive income tax rate ranging from 3.1% to 5.7%, with various tax brackets.
  • Kansas employers pay 0.2% to 7.6% in unemployment tax on a taxable wage base of $14,000. New employers pay a rate of 2.7%. New construction businesses pay 6.0% and new government employers pay 1.7%.
  • For more on income nexus, see Kansas Payroll Tax FAQs.

 

Kentucky

Kentucky Economic Nexus

Kentucky requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the Commonwealth of Kentucky.

What Does Kentucky Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Kentucky customers and shipping products into Kentucky.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Kentucky through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Kentucky.

What is Economic Nexus in Kentucky?

  • Remote sellers and marketplace facilitators must collect Kentucky sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Kentucky sales.
  • To determine if your business has economic nexus in Kentucky, you can download and submit a Kentucky Economic Nexus Questionnaire.
  • Sellers that only sell products on a marketplace facilitator need not collect and remit Kentucky sales tax, which is the facilitator’s responsibility.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Kentucky is a Class D felony.

 

Kentucky State Payroll Taxes

  • Kentucky employers must register with the Kentucky Department of Revenue and the Kentucky Office of Unemployment Insurance.
  • Kentucky has a flat tax rate of 5%.
  • Kentucky has over 200 tax districts that charge a variable occupational tax. The occupational tax applies to employees who are residents of the district and/or perform their principal business functions in the district. Businesses located in the districts also pay an occupational tax.
  • Kentucky employers pay an unemployment tax with rates ranging from 0.5% to 9.5% on a wage base of $11,100 per employee. New employers pay a flat rate of 2.7% and new construction industry employers pay 9%.
  • For more on income nexus, see Kentucky Payroll Tax FAQs.

Louisiana

Louisiana Economic Nexus

Louisiana requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Louisiana.

What does Louisiana require of remote sellers?

  • Remote sellers and marketplace facilitators that meet Louisiana’s economic threshold must register through the State of Louisiana’s Sales and Use Tax Commission for Remote Sellers Out-of-state sellers will receive a Remote Sellers Account Number when filing sales tax returns.
  • The Louisiana sales tax rate is 4.45%. There may be additional local city and parish sales taxes.
  • Louisiana’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Louisiana customers and shipping products into Louisiana.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Louisiana through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Louisiana.

What is Economic Nexus in Louisiana?

  • Remote sellers and marketplace facilitators must collect Louisiana sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Louisiana sales.
  • Louisiana also designates an economic nexus threshold for “Remote Retailers.” Remote retailers have no physical presence in the state but make more than $50,000 in annual sales and do not meet the thresholds to be remote sellers. Remote retailers pay an 8.45% combined state and local tax and register with the Department of Revenue.
  • An out-of-state seller may also qualify as a Direct Marketer in Louisiana if the business engages in “regular or systematic solicitation of a consumer market” by distributing catalogs, periodicals, or other means of advertising. Direct marketers register with the Department of Revenue and collect and remit a combined state and local tax of 8.45%.
  • For more on the difference between a remote retailer, direct marketer, and remote seller in Louisiana, see the Remote Sellers FAQ.
  • Failure to pay sales tax in Louisiana is a penalty of up to a $1,000 fine and/or imprisonment for up to 5 years.

Louisiana State Payroll Taxes

  • Louisiana employers must register with the Louisiana Department of Revenue and the Louisiana Department of Labor.
  • Louisiana has a progressive income tax rate ranging from 1.85% to 4.25%, with various tax brackets.
  • Employers pay a varying unemployment tax rate of 0.09% to 6.2% on a taxable wage base of $7,700. Depending on the industry, new employers pay a tax rate ranging from 1.16% and 2.89%.
  • For more on income nexus, see Louisiana Payroll Tax FAQs.

Maine

Maine Economic Nexus

Maine requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Maine.

What does Maine require of remote sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Maine customers and shipping products into Maine.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Maine through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Maine.

What is Economic Nexus in Maine?

  • Remote sellers and marketplace facilitators must collect Maine sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Maine sales during the current or previous calendar year.
  • Failure to pay sales tax in Maine is a class D crime. Subsequent offenses are a Class C crime.

Maine State Payroll Taxes

  • All Maine employers must register with the Maine Revenue Services and the Maine Department of Labor.
  • Maine has a progressive income tax rate ranging from 5.8% to 7.15%, with various tax brackets.
  • Maine employers pay a varying unemployment tax rate of 0.53% to 6.16% on a taxable wage base of $12,000. New employers pay a flat rate of 2.24%.
  • For more on income nexus, see Maine Payroll Tax FAQs.

Maryland

Maryland Economic Nexus

Maryland requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Maryland.

What Does Maryland Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Maryland’s economic threshold must obtain a sales and use tax license through the Comptroller of Maryland.
  • Once a business has registered, it must use the Maryland bFile sales tax portal to remit sales taxes.
  • The Maryland sales tax rate is 6% (the alcoholic beverage tax is 9%). There are no additional city or county sales taxes.
  • Maryland’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Maryland customers and shipping products into Maryland.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Maryland through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Maryland.

What is Economic Nexus in Maryland?

  • Remote sellers and marketplace facilitators must collect Maryland sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Maryland sales during the current or previous calendar year.
  • Failure to pay sales tax in Maryland is a misdemeanor. The penalty is up to a $10,000 fine and/or imprisonment for up to 5 years.

Maryland State Payroll Taxes

  • Employers must register with the Maryland Comptroller’s Office for payroll withholding and Unemployment Insurance.
  • Maryland has a progressive income tax ranging from 2% to 5.75%, depending on the employee’s filing status and income level.
  • Maryland’s 23 counties and Baltimore City levy a local income tax based on an employee’s taxable income. Local tax rates range from 2.25% to 3.2% and are based on where employees live, not where they work.
  • Maryland’s Unemployment Insurance rates range from 1% to 10.5%, and the wage base is $8,500 per year. New employers pay a flat Unemployment Insurance rate of 2.3%. New employers in the construction industry pay a flat 5.4%.
  • For more on income nexus, see Maryland Payroll Tax FAQs.

Massachusetts

Massachusetts Economic Nexus

Massachusetts requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the Commonwealth of Massachusetts.

What Does Massachusetts Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Massachusetts’s economic threshold must register and remit sales tax through Massachusetts’ MassTaxConnect online portal.
  • The Massachusetts sales tax rate is 6.25%. There are no additional city or county sales taxes.
  • Massachusetts’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Massachusetts customers and shipping products into Massachusetts.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Massachusetts through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Massachusetts.

What is Economic Nexus in Massachusetts?

  • Remote sellers and marketplace facilitators must collect Massachusetts sales tax only if the remote seller has $100,000 or more in gross revenue. There is no threshold for the number of transactions.
  • Failure to pay sales tax in Massachusetts is a felony. The penalty is up to a $10,000 fine and/or imprisonment for up to 5 years. 

Massachusetts State Payroll Taxes

  • Employers are required by law to withhold income tax from the wages of residents and out-of-state and nonresidents for services performed in Massachusetts.
  • Massachusetts employers contribute a flat income tax rate of 5% per employee, no matter the salary.
  • Employers pay unemployment taxes at a range between 0.94% and 14.37%. New employers pay a flat rate of 2.42%, and construction employers pay 7.37%.
  • Massachusetts employers pay a Workforce Training Contribution of 0.056%.
  • Employers paying Unemployment Insurance must also pay into EMAC (Employer Medical Assistance Contribution) at a rate between 0.12% and 0.34%. New employers are exempt for the first three years.
  • For more on income nexus, see Massachusetts Payroll Tax FAQs.

Michigan

Michigan Economic Nexus

Michigan requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Michigan.

What Does Michigan Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Michigan customers and shipping products into Michigan.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace. Learn more with Michigan’s marketplace facilitators FAQs.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Michigan through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Michigan.

What is Economic Nexus in Michigan?

  • Remote sellers and marketplace facilitators must collect Michigan sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Michigan sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Michigan is a felony with a penalty of up to a $5,000 fine and/or imprisonment for up to 5 years.

Michigan State Payroll Taxes

  • Michigan employers must register with the Michigan Department of Treasury and the Michigan Unemployment Insurance Agency.
  • Michigan has a flat income tax rate of 4.25%.
  • Many Michigan cities levy a local income tax on resident and nonresident employees at a varying range from 1.5% to 2.4%.
  • Employers contribute to Unemployment Insurance with rates ranging from 0.06% to 10.3%. New employers pay a flat rate of 2.7%. New construction employers pay a flat rate of 6.3%.
  • For more on income nexus, see Michigan Payroll Tax FAQs.

Minnesota

Minnesota Economic Nexus

Minnesota requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Minnesota.

What Does Minnesota Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Minnesota customers and shipping products into Minnesota.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Minnesota through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Minnesota.

What is Economic Nexus in Minnesota?

  • Remote sellers and marketplace facilitators must collect Minnesota sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Minnesota sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Minnesota is a gross misdemeanor, and a willful attempt to evade paying sales tax is a felony.

Minnesota State Payroll Taxes

  • Minnesota employers must register with the Minnesota Department of Revenue and the Minnesota Unemployment Insurance (UI) Program.
  • Minnesota has a progressive income tax rate ranging from 5.35% to 9.85%, with various tax brackets.
  • Minnesota employers pay an unemployment tax on a taxable wage base of $38,000, ranging from 0.57% to 10.716%. New employers pay a tax rate based on the average rate for their industry. New construction businesses also pay a varying rate.
  • For more on income nexus, see Minnesota Payroll Tax FAQs.

Mississippi

Mississippi Economic Nexus

Mississippi requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Mississippi.

What Does Mississippi Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Mississippi customers and shipping products into Mississippi.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Mississippi through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Mississippi.

What is Economic Nexus in Mississippi?

  • Remote sellers and marketplace facilitators must collect Mississippi sales tax only if the remote seller has $250,000 or more in gross revenue over any 12-month period. There is no threshold for the number of transactions.
  • Failure to pay sales tax in Mississippi is a misdemeanor with a $50-100 fine.

Mississippi State Payroll Taxes

  • Mississippi employers must register with the Mississippi Department of Revenue and the Department of Employment Security.
  • Mississippi has a progressive income tax rate ranging from 3% to 5%, with various tax brackets. As of 2023, the state will reduce the tax rate incrementally until reaching 4% in 2026.
  • Mississippi employers pay a varying unemployment tax rate of 0% to 5.4% on a taxable wage base of $14,000. New employers pay a flat tax of 1%.
  • For more on income nexus, see Mississippi Payroll Tax FAQs.

Missouri

Missouri Economic Nexus

As of January 1, 2023, Missouri will require all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Missouri.

What Does Missouri Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Missouri’s economic threshold must complete a Missouri Tax Registration Application through the MyTax Missouri online portal.
  • The Missouri sales tax rate is 4.225%. There are additional local city and county taxes you can view online.
  • All sales tax returns filed and paid by the required due date are granted a 2% timely payment allowance.
  • Missouri’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Missouri customers and shipping products into Missouri.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Missouri through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Missouri.

What is Economic Nexus in Missouri?

  • Effective January 1, 2023, Missouri will have an economic nexus threshold of $100,000 in cumulative gross receipts for remote sellers and marketplace facilitators in a 12-month period. There is no threshold for the number of transactions.
  • The penalty for failing to pay sales tax in Missouri is a fine of up to $10,000 and/or imprisonment for up to 5 years.

Missouri State Payroll Taxes

  • Missouri employers must register with the Missouri Department of Revenue and the Missouri Department of Labor.
  • Missouri has a progressive income tax rate ranging from 1.5% to 5.3%.
  • Employers with employees in Kansas City and St. Louis must withhold a local tax of 1% from employees’ paychecks. St. Louis employers also remit payroll expense taxes of 0.5%.
  • Missouri employers pay an unemployment tax on a wage base of $11,000. Rates range from 0% to 5.4%. New employers pay a flat rate of 2.376%.
  • For more on income nexus, see Missouri Payroll Tax FAQs.

Montana

Montana Economic Nexus

As of this writing, Montana does not have a general sales tax, so remote sellers or marketplace facilitators are not required to collect or remit sales tax.

Montana State Payroll Taxes

  • Montana employers must register with the Montana Department of Revenue and the Department of Labor and Industry.
  • Montana has a progressive income tax rate ranging from 1% to 6.75%, with various tax brackets.
  • Montana employers pay a varying unemployment tax rate of 0% to 6.12% on a taxable wage base of $38,100. New employers pay a tax between 1.3% to 2.3%, depending on your industry.
  • For more on income nexus, see Montana Payroll Tax FAQs.

Nebraska

Nebraska Economic Nexus

Nebraska requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Nebraska.

What Does Nebraska Require of Remote Sellers?

What is a Remote Seller?

  • A remote seller is any business or person that does not have a physical presence making direct sales to Nebraska customers and shipping products into Nebraska.

What is a Marketplace Facilitator?

  • A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

  • A marketplace seller is a business or person that only makes sales in Nebraska through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Nebraska.

What is Economic Nexus in Nebraska?

  • Remote sellers and marketplace facilitators must collect Nebraska sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Nebraska sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Nebraska is a Class IV misdemeanor. If you willfully fail to pay sales tax, the penalty is a Class IV felony.

Nebraska State Payroll Taxes

  • Nebraska employers must register with the Nebraska Department of Revenue and the Department of Labor.
  • Nebraska has a progressive income tax rate ranging from 2.46% to 6.84%, with various tax brackets. Nebraska will reduce the top tax rate incrementally starting in 2023.
  • Nebraska Unemployment Insurance Tax: Nebraska employers pay a varying unemployment tax rate of 0% to 5.4% on a taxable wage base of $9,000. New employers pay a flat tax of 1.25%. New construction employers pay a flat 5.4%.
  • For more on income nexus, see Nebraska Payroll Tax FAQs.

Nevada

Nevada Economic Nexus

Nevada requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Nevada.

What Does Nevada Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Nevada customers and shipping products into Nevada.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Nevada through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Nevada.

What is Economic Nexus in Nevada?

  • Remote sellers and marketplace facilitators must collect Nevada sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Nevada sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Nevada is a misdemeanor. The penalty is up to a $500 fine and/or imprisonment for up to 6 months.

Nevada State Payroll Taxes

  • Nevada employers must register with the Nevada Department of Employment, Training & Rehabilitation.
  • Nevada has no state income tax, so employers are not required to register for state payroll taxes.
  • Employers pay an unemployment tax with rates ranging from 0.25% to 5.4% on a taxable wage base of $36,600. New employers pay 2.95%.
  • For more on income nexus, see Nevada Payroll Tax FAQs.

New Jersey

New Jersey Economic Nexus

New Jersey requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of New Jersey.

What Does New Jersey Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to New Jersey customers and shipping products into New Jersey.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in New Jersey through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to New Jersey.

What is Economic Nexus in New Jersey?

  • Remote sellers and marketplace facilitators must collect New Jersey sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from New Jersey sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in New Jersey is a misdemeanor. Failure with intent to evade paying sales tax is a third-degree crime. Failure to remit $75,000 or more in sales tax collected is a second-degree crime.

New Jersey State Payroll Taxes

  • Employers doing business in New Jersey must register with the State of New Jersey Department of Revenue.
  • New Jersey has a progressive income tax depending on the employee’s filing status and income level, up to 10.75%.
  • Employers with employees working or living in Newark and Jersey City must pay an additional 1% employer tax.
  • Employers and employees contribute to Unemployment Insurance with rates ranging from 0.5% to 5.8%. New employers pay a flat rate of 2.8%.
  • New employers pay 0.5% on employee wages (employees contribute 0.47%) for Disability Insurance (DI). The tax rate for existing employers is based on each employer’s claims history.
  • New Jersey employers must withhold 0.28% of employee wages for the state’s Family Leave Insurance (FLI) plan.
  • Employers contribute 0.1175%, and employees contribute 0.0425% to the NJ Workforce Development Partnership Fund.
  • For more on income nexus, see New Jersey Payroll Tax FAQs.

New Mexico

New Mexico Economic Nexus

Although the State of New Mexico has no sales tax, it does require all remote sellers and marketplace facilitators with economic nexus to register with the State of New Mexico.

What Does New Mexico Require of Remote Sellers?

  • New Mexico does not have a sales tax; instead, it has a gross receipts tax. This tax is imposed on persons engaged in business in New Mexico. The person or company engaged in business generally passes the tax on to the consumer separately or as part of the selling price.
  • The gross receipts tax rate varies throughout the state from 5.125% to 8.8675%, depending on the location of the business.
  • Remote sellers and marketplace facilitators that meet New Mexico’s economic threshold must register and remit sales tax to New Mexico Taxation and Revenue Department’s Taxpayer Access Point (TAP).

What is a Remote Seller?

A remote seller is any person or business that does not have a physical presence making direct sales to New Mexico customers and shipping products into New Mexico.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a person or business that only makes sales in New Mexico through a marketplace facilitator (e.g., a third-party website). 

What is Economic Nexus in New Mexico?

  • Remote sellers and marketplace facilitators must remit New Mexico gross receipts taxes if the remote seller has $100,000 or more in gross revenue.
  • Failure to pay sales tax in New Mexico is a felony. The penalty is a $1,000 – $10,000 fine and/or imprisonment for 1 – 5 years.

New Mexico State Payroll Taxes

  • New Mexico employers must register with the Department of Taxation & Revenue and the Department of Workforce Solutions.
  • New Mexico has a progressive income tax rate ranging from 1.7% to 5.9%, with various tax brackets.
  • Employers pay a varying unemployment tax rate of 0.33% to 6.4% on a taxable wage base of $28,700. New employers pay 1.00%. Agriculture, Forestry, Fishing, & Hunting = 1.08%. Public Administration (Govt Entities Only) = 1.07%
  • New Mexico employees and employers must pay the state a Workers’ Compensation Fee. Employer fees are $2.30 per employee per quarter. Employee fees are $2.00 per quarter.
  • For more on income nexus, see New Mexico Payroll Tax FAQs.

New York

New York Economic Nexus

New York requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to New York State.

What Does New York Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to New York customers and shipping products into New York.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in New York through a marketplace facilitator (e.g., a third-party website).

What is Economic Nexus in New York?

  • Remote sellers and marketplace facilitators must remit New York gross receipts taxes if the remote seller has made more than $500,000 or more in gross revenue and conducted more than 100 sales during the current or previous calendar year.
  • Failure to pay sales tax in New York is a misdemeanor. If there is an attempt to defraud the state, it’s a Class E felony.

New York State Payroll Taxes

  • New York employers must register for payroll taxes with the New York Department of Taxation and Finance.
  • New York has a progressive income tax of 4% to 10.9%.
  • Employers with employees living in New York City and Yonkers must withhold additional income tax.
  • Employers in New York must contribute taxes for Unemployment Insurance through The New York State Department of Labor (NYSDOL). The rate varies from 0.525% to 7.825%. New employers pay a flat rate of 4.025% with a RSF rate = .075% and a total rate of 4.1%.
  • New York employers can also opt to pay an Employer Compensation Expense Tax (ECET) to offset employees’ federal taxes.
  • Employers must pay a flat tax of 0.075% on the total quarterly payroll to the Re-employment Services Fund (RSF). This fund provides support and training for the unemployed.
  • New York also requires employees/employers to contribute to State Disability Insurance and Paid Family Medical Leave. Employers can share in the contribution or have employees bear the full responsibility from their wages.
  • For more on income nexus, see New York Payroll Tax FAQs.

North Carolina

North Carolina Economic Nexus

North Carolina requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of North Carolina.

What does North Carolina require of remote sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to North Carolina customers and shipping products into North Carolina.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in North Carolina through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to North Carolina.

What is Economic Nexus in North Carolina?

  • Remote sellers and marketplace facilitators must collect North Carolina sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from North Carolina sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in North Carolina is a Class 1 misdemeanor and a Class H felony if there’s an attempt to evade paying sales taxes.

North Carolina State Payroll Taxes

  • North Carolina employers must register with the N.C. Department of Revenue and N.C. Division of Employment Security (DES).
  • North Carolina employers withhold a flat income tax rate of 4.99%.
  • Employers with employees earning a wage base of $28,000 pay for each employee’s Unemployment Insurance at a rate between 0.06% and 5.76%. New employers pay a flat 1% rate.
  • Employers must also pay a 20% surtax on UI contributions in a calendar year when the state’s Unemployment Insurance Trust Fund is less than $1 billion.
  • For more on income nexus, see North Carolina Payroll Tax FAQs.

North Dakota

North Dakota Economic Nexus

North Dakota requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of North Dakota.

What Does North Dakota Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence to make direct sales to North Dakota customers and ship products into North Dakota.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in North Dakota through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to North Dakota.

What is Economic Nexus in North Dakota?

  • Remote sellers and marketplace facilitators must collect North Dakota sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from North Dakota sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in North Dakota is a Class A misdemeanor.

North Dakota State Payroll Taxes

  • North Dakota employers must register with the North Dakota State Government and Job Service North Dakota.
  • North Dakota has a progressive income tax rate ranging from 1.1% to 2.9%, with various tax brackets.
  • North Dakota employers pay a varying Unemployment Insurance tax rate of 0.8% to 9.69% on a taxable wage base of $38,400. New employers pay a flat tax of 1.21%. New construction employers pay 9.75%. Negative Balance in account rate = 6.15%.
  • For more on income nexus, see North Dakota Payroll Tax FAQs.

Ohio

Ohio Economic Nexus

Ohio requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Ohio.

What Does Ohio Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Ohio’s economic threshold must obtain a seller’s use tax license, collect tax on taxable sales made to consumers in the state, file returns, and remit the appropriate tax.
  • Out-of-state sellers can obtain a seller’s use tax license and remit sales tax through the Ohio Business Gateway.
  • The Ohio sales tax rate is 5.75%. There are additional local city and county sales taxes.
  • Remote sellers may also register for Ohio sales tax through the Streamlined Sales Tax Registration System.
  • The Streamlined Sales Tax System allows remote sellers to submit one application to collect and remit sales and use taxes in 24 Streamlined member states.
  • See the Streamlined Sales Tax Governing Board for more information on Marketplace Sellers and Marketplace Facilitators registration in the Streamlined States.
  • Ohio’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Ohio customers and shipping products into Ohio.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Ohio through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Ohio.

What is Economic Nexus in Ohio?

  • Remote sellers and marketplace facilitators must collect Ohio sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Ohio sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Ohio is a Class 4 felony.

Ohio State Payroll Taxes

  • Ohio employers must register with the Ohio Department of Taxation, Ohio Department of Job and Family Services, and Ohio’s Regional Income Tax Agency (RITA).
  • Ohio has a progressive income tax rate ranging from 0% to 3.99%, with various tax brackets.
  • 566 Ohio cities and villages charge residents, employees, and businesses an additional local income tax ranging from 0.5% to 2.75%.
  • Ohio employers pay an unemployment tax with rates ranging from 0.8% to 10.2% on a taxable wage base of $9,000. New employers pay a flat 2.7% in 2022. New construction businesses pay 5.5%.
  • For more on income nexus, see Ohio Payroll Tax FAQs.

Oklahoma

Oklahoma Economic Nexus

Oklahoma requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Oklahoma.

What Does Oklahoma Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Oklahoma customers and shipping products into Oklahoma.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Oklahoma through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Oklahoma.

What is Economic Nexus in Oklahoma?

  • Remote sellers and marketplace facilitators must collect Oklahoma sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Oklahoma is a misdemeanor. The penalty is up to a $500 fine for the first offense and up to a $1,000 fine and/or imprisonment for subsequent offenses.

Oklahoma State Payroll Taxes

  • Oklahoma employers must register with the Oklahoma Tax Commission and the Oklahoma Employment Security Commission.
  • Oklahoma has a progressive income tax rate ranging from 0.25% to 4.75%, with various tax brackets.
  • Oklahoma employers pay a varying unemployment tax rate of 0.3% to 7.5% on a taxable wage base of $24,800. New employers pay a flat tax rate of 1.5%.
  • For more on income nexus, see Oklahoma Payroll Tax FAQs.

Oregon

Oregon Economic Nexus

As of this writing, the state of Oregon does not have a general sales tax; therefore, remote sellers or marketplace facilitators are not required to collect or remit sales tax.

Oregon State Payroll Taxes

  • Oregon employers must register with the Oregon Employment Department and the Oregon Department of Revenue.
  • Oregon has a progressive income tax rate ranging from 4.75% to 9.9%.
  • Employees pay a transit tax of 0.01%, which is withheld by their employers. Employers who pay wages to employees within the TriMet boundaries and Lane County also pay transit taxes—rates vary.
  • Oregon employers pay an unemployment tax on a wage base of $47,700. Rates range from 0.9% to 5.4%. New employers pay a flat rate of 2.4%.
  • For more on income nexus, see Oregon Payroll Tax FAQs.

Pennsylvania

Pennsylvania Economic Nexus

Pennsylvania requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the Commonwealth of Pennsylvania.

What Does Pennsylvania Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Pennsylvania’s economic threshold must register and remit sales tax through the Pennsylvania Department of Revenue’s e-TIDESonline portal.
  • The Pennsylvania sales tax rate is 6%. There are additional local city and county sales taxes.
  • Pennsylvania’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Pennsylvania customers and shipping products into Pennsylvania.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Pennsylvania through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Pennsylvania.

What is Economic Nexus in Pennsylvania?

  • Remote sellers and marketplace facilitators must collect Pennsylvania sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • Failure to pay sales tax in Pennsylvania is a misdemeanor. The penalty is up to a $1,000 fine and the costs of prosecution and/or imprisonment for up to one year. A person who fails to remit collected tax may be charged with embezzlement, misapplication of entrusted property, and/or theft.

Pennsylvania State Payroll Taxes

  • Pennsylvania employers must register with the Pennsylvania Department of Revenue and the Pennsylvania Department of Labor & Industry.
  • Employers contribute a flat income tax rate of 3.07% per employee.
  • Employers with business locations in Pennsylvania must withhold and remit the local Earned Income Tax (EIT) and Local Services Tax (LST) on behalf of their employees working in Pennsylvania.
  • Employers are responsible for withholding unemployment taxes in Pennsylvania for employees earning over $10,000, ranging between 1.2905% to 9.9333%. New employers pay a flat 3.689%. Construction employers pay a flat 10.2238.
  • For more on income nexus, see Pennsylvania Payroll Tax FAQs.

Rhode Island

Rhode Island Economic Nexus

Rhode Island requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Rhode Island.

What Does Rhode Island Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Rhode Island’s economic threshold must register with the Rhode Island Division of Taxation Business Registration online portal and remit sales tax through the RI Taxation portal.
  • The Rhode Island sales tax rate is 7%. There are no additional local city or county sales taxes.
  • Remote sellers may also register for Rhode Island sales tax through the Streamlined Sales Tax Registration System.
  • The Streamlined Sales Tax System allows remote sellers to submit one application to collect and remit sales and use taxes in 24 Streamlined member states.
  • See the Streamlined Sales Tax Governing Board for more information on Marketplace Sellers and Marketplace Facilitators registration in the Streamlined States.
  • Rhode Island’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.
  • Rhode Island also requires “referrers” with economic nexus to register with the Rhode Island Division of Taxation. Rhode Island defines a referrer as a person or business that:
    • Contracts with a retailer to list/advertise for sale in Rhode Island taxable goods/services
    • Receives a fee, commission, or other compensation from a retailer for listing/advertising
    • Transfers via the internet or otherwise an in-state customer
    • Does not collect payments from in-state customers for the transaction

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Rhode Island customers and shipping products into Rhode Island.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Rhode Island through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Rhode Island.

What is Economic Nexus in Rhode Island?

  • Remote sellers, marketplace facilitators, and referrers must collect Rhode Island sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Rhode Island sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • The penalty for failing to pay sales tax in Rhode Island is a fine of up to $10,000 and/or imprisonment for up to one year.

Rhode Island State Payroll Taxes

  • Rhode Island employers must register through the Rhode Island Division of Taxation.
  • Rhode Island has a progressive income tax rate ranging from 3.75% to 5.99%, with three tax brackets.
  • Employers pay a varying unemployment tax rate of .99% to 9.59% on a taxable wage base of $24,600. New employers pay a flat tax rate of 0.98%.
  • RI employers pay a 0.21% state tax per employee to the Rhode Island Job Development Fund.
  • Employers withhold 1.3% of employee paychecks for the Rhode Island Temporary Disability Tax.
  • For more on income nexus, see Rhode Island Payroll Tax FAQs.

South Carolina

South Carolina Economic Nexus

South Carolina requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of South Carolina.

What Does South Carolina Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to South Carolina customers and shipping products into South Carolina.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in South Carolina through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to South Carolina.

What is Economic Nexus in South Carolina?

  • Remote sellers and marketplace facilitators must collect South Carolina sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • The penalty for failing to pay sales tax in South Carolina is a fine of up to $10,000 and/or imprisonment for up to one year.

South Carolina State Payroll Taxes

  • South Carolina employers must register with the South Carolina Department of Revenue and the South Carolina Department of Employment and Workforce (DEW).
  • South Carolina has a progressive income tax rate ranging from 0% to 7%.
  • South Carolina employers pay an unemployment tax ranging from 0% to 5.4%, with a taxable wage base of $14,000. New employers pay .55% which includes a .06% DACA Rate.
  • For more on income nexus, see South Carolina Payroll Tax FAQs.

South Dakota

South Dakota Economic Nexus

South Dakota requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of South Dakota.

What Does South Dakota Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to South Dakota customers and shipping products into South Dakota.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in South Dakota through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to South Dakota.

What is Economic Nexus in South Dakota?

  • Remote sellers, marketplace facilitators, and referrers must collect South Dakota sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from South Dakota sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in South Dakota is a Class 1 misdemeanor. Failure to pay two or more times within a 12-month period is a Class 6 felony.

South Dakota State Payroll Taxes

  • South Dakota employers must register with the South Dakota Department of Labor & Regulation.
  • South Dakota has no state income tax, so as an employer, you are not required to register for state payroll taxes. However, you must withhold federal income and payroll taxes, such as Social Security and Medicare.
  • Employers pay a varying reemployment assistance tax rate of 0% to 9.3% on a taxable wage base of $15,000. New employers pay a flat tax of 1.2%. New construction employers pay 6%. New employers also pay an investment fee of .55% for their first three years in business.
  • For more on income nexus, see South Dakota Payroll Tax FAQs.

Tennessee

Tennessee Economic Nexus

Tennessee requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Tennessee.

What Does Tennessee Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Tennessee’s economic threshold must register and remit sales tax through the Tennessee Taxpayer Access Point (TNTAP).
  • The Tennessee sales tax is 7%. There are additional local city and county sales taxes.
  • Tennessee’s voluntary disclosure program allows unregistered taxpayers to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Tennessee customers and shipping products into Tennessee.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Tennessee through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Tennessee.

What is Economic Nexus in Tennessee?

  • Remote sellers and marketplace facilitators must collect Tennessee sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • Failure to pay sales tax in Tennessee is a Class E felony. If the offense involves less than $500 in use tax, it is a Class A misdemeanor.

Tennessee State Payroll Taxes

  • Tennessee employers must register with the Tennessee Department of Labor & Workforce Development.
  • Tennessee has no state income tax. Employers are responsible for withholding federal income taxes only.
  • Employers pay an unemployment tax with rates ranging from 0.1% to 10% on a taxable wage base of $7,000. New employers pay a flat rate of 2.7%.
  • For more on income nexus, see Tennessee Payroll Tax FAQs.

Texas

Texas Economic Nexus

Texas requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Texas.

What Does Texas Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Texas customers and shipping products into Texas.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Texas through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Texas.

What is Economic Nexus in Texas?

  • Remote sellers and marketplace facilitators must collect Texas sales tax only if the remote seller has $500,000 or more in gross revenue during the current or previous calendar year.
  • Failure to pay sales tax in Texas is a Class C misdemeanor if the amount is less than $10,000. It’s a felony if the amount owed is more than $10,000.

Texas State Payroll Taxes

  • Texas employers must register with the Texas State Attorney General and the Texas Workforce Commission (TWC) for Unemployment Taxes.
  • Texas has no state income tax. Employers are responsible for withholding federal income taxes only.
  • The TWC uses three employment categories: regular, domestic, and agricultural, and the employer tax liability differs for each type of employment. On a taxable wage base of $9,000, the rate range is 0.31% to 6.31%. New employers pay 2.7% or the industry average, if higher.
  • For more on income nexus, see Texas Payroll Tax FAQs.

Utah

Utah Economic Nexus

Utah requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Utah.

What Does Utah Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Utah’s economic threshold must register for a Utah sales tax license and remit sales taxes using Utah’s Taxpayer Access Point at utah.gov.
  • The Utah sales tax rate is 4.7%. There are additional local city and county sales taxes.
  • Remote sellers may also register for Utah sales tax through the Streamlined Sales Tax Registration System
  • The Streamlined Sales Tax System allows remote sellers to submit one application to collect and remit sales and use taxes in 24 Streamlined member states.
  • See the Streamlined Sales Tax Governing Board for more information on Marketplace Sellers and Marketplace Facilitators registration in the Streamlined States.
  • Utah’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Utah customers and shipping products into Utah. 

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Utah through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Utah.

What is Economic Nexus in Utah?

  • Remote sellers, marketplace facilitators, and referrers must collect Utah sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Utah sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Utah is a 2nd-degree felony with a $1,500 to $25,000 fine.

Utah State Payroll Taxes

  • Utah employers must register with the Utah State Tax Commission and the Utah Department of Workforce Services.
  • Utah employees pay a flat payroll tax of 4.95%.
  • Utah employers pay an unemployment tax on a wage base of $41,600. Rates range from 1% to 7.3%. New employers pay a rate based upon the average rates of all employers in their respective industries.
  • For more on income nexus, see Utah Payroll Tax FAQs.

Vermont

Vermont Economic Nexus

Vermont requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Vermont.

What Does Vermont Require of Remote Sellers?

  • Remote sellers and marketplace facilitators that meet Vermont’s economic threshold must register for a Vermont business tax account and license to collect and remit via the Vermont Sales Tax through Vermont’s myVTax online portal.
  • The Vermont sales tax rate is 6%. There are additional local city and county sales taxes.
  • Remote sellers may also register for Vermont sales tax through the Streamlined Sales Tax Registration System.
  • The Streamlined Sales Tax System allows remote sellers to submit one application to collect and remit sales and use taxes in 24 Streamlined member states.
  • See the Streamlined Sales Tax Governing Board for more information on Marketplace Sellers and Marketplace Facilitators registration in the Streamlined States.
  • Vermont’s voluntary disclosure program provides unregistered taxpayers the opportunity to self-disclose and pay previously unpaid or underpaid tax liabilities without penalties in most cases.

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Vermont customers and shipping products into Vermont.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Vermont through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Vermont.

What is Economic Nexus in Vermont?

  • Remote sellers, marketplace facilitators, and referrers must collect Vermont sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Vermont sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • The penalty for failing to pay sales tax in Vermont is a fine of up to $1,000 and/or imprisonment for up to one year. If the tax owed exceeds $500, the penalty is up to a $10,000 fine and/or imprisonment for up to three years.

Vermont State Payroll Taxes

  • Vermont employers must register with the Vermont Department of Taxes and the Vermont Department of Labor.
  • Vermont has a progressive income tax rate ranging from 3.35% to 8.75%, with various tax brackets.
  • Vermont employers pay a varying unemployment tax rate of 0.8% to 6.5% on a taxable wage base of $15,500. Depending on the industry, new employers pay a tax rate of 1%.
  • Employers not offering a healthcare plan must contribute to the Vermont Health Care Fund. The rate is determined by the number of uncovered full-time employees over 18 years old.
  • For more on income nexus, see Vermont Payroll Tax FAQs.

Virginia

Virginia Economic Nexus

Virginia requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the Commonwealth of Virginia.

What Does Virginia Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Virginia customers and shipping products into Virginia.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Virginia through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Virginia.

What is Economic Nexus in Virginia?

  • Remote sellers and marketplace facilitators must collect Virginia sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Virginia sales during the current or previous calendar year.
  • Failure to pay sales tax in Virginia is a Class 1 misdemeanor.

Virginia State Payroll Taxes

  • Virginia employers must register with the Virginia Department of Revenue.
  • Virginia income taxes are based on taxable income separated into four brackets with rates ranging from 2% to 5.75%.
  • Virginia employers must pay Unemployment Insurance of between 0.33% to 6.43%. The wage base for SUI is $8,000 of each employee’s taxable income. New employers pay of 2.73%.
  • For more on income nexus, see Virginia Payroll Tax FAQs.

Washington

Washington Economic Nexus

Washington requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Washington.

What Does Washington Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Washington customers and shipping products into Washington.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Washington through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Washington.

What is Economic Nexus in Washington?

  • Remote sellers, marketplace facilitators, and referrers must collect Washington sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Washington is a gross misdemeanor.

Washington State Payroll Taxes

  • Washington employers must register with the Washington State Division of Child Support (DCS) and the Washington State Employment Security Department for Unemployment Taxes.
  • Employers must also register for a Workers’ Compensation account with the Washington State Department of Labor & Industries (L&I).
  • Washington does not have a state income tax. Employers must withhold federal income and payroll taxes, such as Social Security and Medicare.
  • Employers must pay a tax of 0.3% to 6.0% to Washington’s Unemployment Insurance tax fund on a wage base of $62,500.
  • Workers’ compensation insurance coverage is required for all full-time and part-time employees in Washington and administered through the Washington State Department of Labor & Industries (L&I).
  • For more on income nexus, see Washington Payroll Tax FAQs.

West Virginia

West Virginia Economic Nexus

West Virginia requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of West Virginia.

What Does West Virginia Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to West Virginia customers and shipping products into West Virginia.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in West Virginia through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to West Virginia.

What is Economic Nexus in West Virginia?

  • Remote sellers, marketplace facilitators, and referrers must collect West Virginia sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from West Virginia sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in West Virginia is a misdemeanor with a $100 to $2,500 fine and/or imprisonment for up to 6 months.

West Virginia State Payroll Taxes

  • West Virginia employers must register through the West Virginia State Tax Department and the Workforce West Virginia Department.
  • West Virginia has a progressive income tax rate ranging from 3% to 6.5%.
  • Employers pay a varying unemployment tax rate between 1.5% to 8.5% on a taxable wage base of $12,000. New employers pay a flat tax rate of 2.7%. Construction employers pay 8.5%.
  • Employers with employees working in certain cities in West Virginia must withhold a local “city service fee” from employee wages.
  • For more on income nexus, see West Virginia Payroll Tax FAQs.

Wisconsin

Wisconsin Economic Nexus

Wisconsin requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Wisconsin.

What Does Wisconsin Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Wisconsin customers and shipping products into Wisconsin.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Wisconsin through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Wisconsin.

What is Economic Nexus in Wisconsin?

  • Remote sellers, marketplace facilitators, and referrers must collect Wisconsin sales tax only if the remote seller has $100,000 or more in gross revenue during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Wisconsin is considered a felony or misdemeanor theft, depending on the amount of tax involved.

Wisconsin State Payroll Taxes

  • Wisconsin employers must register with the Wisconsin Department of Revenue and the Wisconsin Department of Workforce Development.
  • Wisconsin has a progressive income tax rate ranging from 3.54% to 7.65%, with various tax brackets.
  • Employers pay an unemployment tax with rates ranging from 0% to 12% on a taxable wage base of $14,000. New employers with a payroll less than $500K pay a flat 3.05%. New employers with a payroll of more than $500K pay a flat 3.25%. New construction businesses pay 2.9% if payroll is less than $500K and 3.1% if payroll is more than $500K.
  • For more on income nexus, see Wisconsin Payroll Tax FAQs.

Wyoming

Wyoming Economic Nexus

Wyoming requires all remote sellers and marketplace facilitators with economic nexus to collect and remit sales and use taxes to the State of Wyoming.

What Does Wyoming Require of Remote Sellers?

What is a Remote Seller?

A remote seller is any business or person that does not have a physical presence making direct sales to Wyoming customers and shipping products into Wyoming.

What is a Marketplace Facilitator?

A marketplace facilitator is a business that contracts with marketplace sellers to facilitate the sale of the marketplace seller’s products through a physical or electronic marketplace.

What is a Marketplace Seller?

A marketplace seller is a business or person that only makes sales in Wyoming through a marketplace facilitator (e.g., a third-party website). The marketplace facilitator collects payment on the sales and remits the tax to Wyoming.

What is Economic Nexus in Wyoming?

  • Remote sellers, marketplace facilitators, and referrers must collect Wyoming sales tax only if the remote seller has $100,000 or more in gross revenue or 200 or more separate transactions from Wyoming sales during the current or previous calendar year.
  • Remote sellers registered with the Streamlined Sales Tax system may use a Certified Service Provider (CSP) to perform all the seller’s sales and use tax functions other than the seller’s obligation to remit tax on its purchases. A CSP is free for sellers and allows a business to outsource most of its sales tax administration responsibilities.
  • Failure to pay sales tax in Wyoming is a misdemeanor with up to a $750 fine and/or imprisonment for up to 6 months if the tax owed is $500 or less, or a felony (up to a $5,000 fine and/or imprisonment for up to 3 years) if the tax owed is over $500.

Wyoming State Payroll Taxes

  • Wyoming employers must register with the Wyoming Department of Workforce Services and the Division of Workers’ Compensation and Unemployment Insurance.
  • Wyoming does not have a state income tax. Employers must withhold federal income and payroll taxes, such as Social Security and Medicare.
  • Wyoming employers pay an unemployment tax with rates ranging from 0.09% to 8.5% on a taxable wage base of $27,700. New employers pay a varying rate, depending on the industry.
  • For more on income nexus, see Wyoming Payroll Tax FAQs.
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<a href="https://www.corpnet.com/blog/author/nellieakalp/" target="_self">Nellie Akalp</a>

Nellie Akalp

Nellie Akalp is an entrepreneur, small business expert, speaker, and mother of four amazing kids. As CEO of CorpNet.com, she has helped more than half a million entrepreneurs launch their businesses. Akalp is nationally recognized as one of the most prominent experts on small business legal matters, contributing frequently to outlets like Entrepreneur, Forbes, Huffington Post, Mashable, and Fox Small Business. A passionate entrepreneur herself, Akalp is committed to helping others take the reigns and dive into small business ownership. Through her public speaking, media appearances, and frequent blogging, she has developed a strong following within the small business community and has been honored as a Small Business Influencer Champion three years in a row.
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