It used to be that the physical presence nexus standard determined if a business was required to register to collect and remit taxes. However, New York and numerous other states have required online retailers that meet specific requirements to collect sales tax for items sold to consumers within their respective states.
As states continue adopting similar click-through-nexus laws, and with the potential for passage of the Marketplace Fairness Act (MFA), nexus standards have been continuously changing. These laws are changing quickly, which requires diligent legislation tracking and tracking sales, while monitoring threshold amounts.
Most experts agree that taxation of online goods is no longer a question of if, but when. So whether the end of tax-free online shopping comes in the form of the MFA or another law all together, it behooves companies to start preparing for the anticipated changes. There are several key actions that can help get a business ahead of the game.