10 Questions Can Help Determine Your Sales Tax Nexus
Businesses often assume they are only required to collect and file sales and use tax in the states where they have an office; however, what determines where you should collect and remit is a term called nexus. In many states, nexus can be triggered by multiple things and is not just based on having just a physical presence in a state. In some states, nexus can be triggered by having remote sales people living in a state, or having a warehouse or distribution center in a state, or it can be triggered by crossing state lines to service tangible personal property to name a few. The list goes on and on of what can trigger nexus, and the definition varies from state-to-state. Avalara has created a simple Nexus Wizard that will walk you through 10 questions to help you analyze where you might have sales and use tax nexus.
Some of the typical questions the wizard will walk you through are:
- Which states do you have an office, warehouse, etc?
- Which states do you have remote employees, or whether you have employees traveling to other states to solicit sales?
- If you attend trade shows in other states?
- If you have third-party representatives soliciting sales in other states?
- If you use online click-thru ads to solicit sales?
To see all the questions and get a clearer picture of what activities might be triggering nexus for you in other states, complete Avalara’s Nexus Wizard today!
After completing Avalara’s nexus wizard you will receive a personalized nexus report based on the answers you provided along with some helpful information on nexus, common business practices that trigger nexus and how they can affect your sales tax audit risk. Take the first step towards understanding your statutory requirements when it comes to sales tax compliance, so you stop exposing your business to unnecessary risk and potential audit penalties and fines.
We have partnered with Avalara to offer our clients a cloud-based, end-to-end, sales tax solution for Microsoft Dynamics. If you are interested in automating sales tax compliance within Microsoft Dynamics, contact us to learn more!