Some aspects of sales tax never seem to change, or they change infrequently. Be assured: Sales tax on digital advertising and marketing is not among those. Digital advertising especially is a hot new area of sales tax as states consider how to tap into this burgeoning stream of potential revenue. Here’s a look at some of the latest developments. An idea that won’t go away Discussion of taxing digital advertising in the U.S. begins (and nearly ended) with Maryland, the first state to levy sales tax on this new kind of taxable commodity. The tax applies to the annual gross revenues of a business ..read more

The common definition of dietary supplements and vitamins is a non-food item that includes a vitamin, mineral, herb, botanical, amino acid or dietary substance. For purposes of incurring sales tax in any state, that essentially translates into “sometimes.” Sometimes a state considers supplements and vitamins as drugs, groceries or food. Sometimes these products are taxable tangible personal property, sometimes not. In other instances, vitamins and supplements aren’t taxed at all. It’s enough to make you reach for the B2 and the magnesium (both recommended in the non-drug world for migraines ..read more

Economic nexus thresholds in many states depend on two numbers. Now, almost six years after the landmark Wayfair case ignited sales tax obligations for more remote sellers, one of those numbers might be falling out of favor. Since the Supreme Court’s decision in 2018, almost all states with economic nexus opted to have dollar volume of sales as one trigger for sales tax obligations. Several states also tossed in the number of transactions over a previous period: $100,000 or 200 transactions in the prior 12 months in Minnesota, for instance, or $500,000 and 100 transactions over the previous fo ..read more

We recently completed our fourth annual client survey and are excited to announce that we have received a world class NPS score of 87! Net Promoter Score ® (NPS ®) is calculated based on responses to a single question, “How likely is it that you would recommend our company/product/service to a friend or colleague?”   NPS can be as low as −100 (all detractors) or as high as +100 (all promoters). An NPS of +50 or over is excellent, for most industries, above 70 is world-class. TaxConnex’s NPS score for their March client survey was 87, making this the fourth year in a row of achieving a world-cl ..read more

Companies outside the United States that sell into America most likely know sales tax obligations from experience with Europe’s value-added tax (VAT) or Canada’s Goods and Services Tax (GST) and Provincial Sales Tax (PST). Is that enough to sell into the U.S. and meet sales tax obligations? The U.S. has no national sales tax for remote sellers and businesses. Most of America’s states (and its thousands of other, smaller jurisdictions) sure do, and in important ways that differ from sales tax obligations outside the U.S. Here’s what you need to know. Nexus Nexus is your connection with the tax ..read more

We are at the end of Q1 of 2024 and continue to discuss how to ensure your business is set up to get sales tax right in 2024. If you’re like the over 49% of businesses who participated in our annual sales tax trends survey and are unsatisfied with the way you are managing sales tax, then you’re in the right place. The complexities surrounding managing your sales and use tax obligations continue to evolve and perplex businesses of all sizes. More businesses than ever have a multi-state sales tax obligation and are trying to find the best way to balance their cost of compliance versus the r ..read more

There’s always something changing in the world of tax, especially sales tax. Here’s a review of some of the recent changes and updates. Amazon still liable. The Court of Appeals of South Carolina has affirmed a state Administrative Law Court (ALC) finding that the online retail giant remains liable for eight figures in unpaid sales tax on third-party sales from 2016, interest and penalties. After initial incentives from South Carolina for an Amazon investment in fulfillment centers 13 years ago, the company was to have begun collecting South Carolina sales tax in 2016. It did, but the South Ca ..read more

The fear of a sales tax audit from one of the country’s thousands of tax jurisdictions is legitimate. Audits can disrupt your business and potentially cost you thousands of dollars. How should you prepare for a sales and use tax audit? A lot of worry The latest results of our annual survey of top finance executives regarding their thoughts and experiences in managing sales tax showed once again that audits are top of mind. Even though most respondents (85%) had already gone through a sales and use tax audit, there’s a growing lack of confidence in audit preparedness in more than one in every f ..read more

Since the first adding machine showed up on counters to help shopkeepers tack on the correct sales tax, automation has been part of compliance. Now the buttons and the lever have given way to behind-the-scenes software and automatic functionality. Good thing, too, as sales tax has evolved beyond a static percentage to involve thousands of tax jurisdictions and ever-changing calculations. But does the new automation always keep up? Dependency and worry Automation figures strongly in how companies stay ahead of their sales tax obligations, according to results from the third annual Taxconnex sur ..read more

The non-fungible token (NFT) remains a sizzling commodity. These digitized assets denote ownership of such collectibles as sports cards and artwork, even designer digital footwear.   Two signs of the size of the sizzle: The online NFT platform OpenSea claims to be worth more than $13 billion. Some NFTs alone on OpenSea have sold for millions and in recent years the average sales price of an NFT (an admittedly volatile commodity) jumped from about $150 to $4,000. That’s a lot of tax potential, and the feds have started to notice. With an eye to pinning down taxability, the IRS proposes to ..read more