Ever since the Supreme Court ruled in South Dakota v. Wayfair that states have the right to require businesses to collect sales tax — even if they maintain no physical presence in a given state — e-commerce tax compliance got more complicated. After the ruling, states created economic nexus, which are thresholds for when a business is required to collect sales tax based on the total number of transactions or total revenue generated. .. Over the past few years, multiple states have been reviewing the transaction threshold requirements for economic nexus, as there’s a sense they may not be fair to smaller sellers. While each state is different, it’s helpful to look at Colorado as an example of how states are viewing transaction thresholds — and subsequently changing sales tax legislation as a result.
Source: taxjar.com
