Tax

    Tax nexus

    A connection to a state that obligates you to collect that state's sales tax.

    Definition

    Physical nexus (office, employees, inventory) and economic nexus (sales over a state threshold, typically $100k or 200 transactions) both trigger collection duties. Crews working across state lines should track economic nexus carefully.

    Related terms

    Sales tax

    A tax on the sale of goods (and sometimes services) collected from the customer at checkout.

    Use tax

    A tax owed on items bought tax-free and used in a state that would normally tax them.