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Sales Tax Support
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The free sales tax information website for small-medium business users.
The free sales tax information website for small-medium business users.

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States Follow South Dakota - At Warp Speed. A By-State Guide on Economic Nexus

If you read some earlier articles, posts or reviews regarding the South Dakota v Wayfair decision - and thought you were up to speed - the BAD NEWS is that you are already behind - as there are already more than 25 states which have followed suit on the ECONOMIC NEXUS issue - through legislation, new economic nexus regulations and/or administrative policy.

THE GOOD NEWS? Ecommerce taxation specialist Sylvia Dion, CPA has just published a new reference chart (which she plans to update as new states follow) which will bring you up to speed. Your thoughts? Which will be the next state added to the chart?

https://www.salestaxsupport.com/blogs/issues/internet-tax-ecommerce/states-follow-south-dakota-a-by-state-guide-on-economic-nexus/
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Post Wayfair - Should Congress enact a federal remote seller bill to limit a state’s power to enact ECONOMIC NEXUS legislation?

Sylvia Dion CPA, a leading internet taxation specialist just published an interesting item regarding the WAYFAIR decision. While there are many great articles out there on the issue - Sylvia provides a great summary to help one ponder the FEDERAL issue… Namely - does the Wayfair decision mean the U.S. Congress will be less likely, or more likely, to enact a federal remote seller bill which could place limits on a state’s power to enact legislation that is even more aggressive than South Dakota’s.

https://www.salestaxsupport.com/blogs/issues/internet-tax-ecommerce/wayfair-and-economic-nexus/
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South Dakota v. Wayfair May Dash Ohio On-Line Guitar Purchase!

Forget about the domino effect this Supreme Court decision may have on other states - and how they define nexus - as well as the resulting impact on on-line/ecommerce sellers - as well as of course shoppers. When someone’s GUITAR dream may be impacted, it puts it all into perspective...

If you are an online seller and are wondering if your nexus status may change in some states (in particular OHIO) , this is a great post to read - as Steve Estelle boils it down to the essential issue when OHIO looks at nexus - and that is “trying to make money”.

Your thoughts re Wayfair impact in OHIO or other states - or (if you read Steve’s post) thoughts on “whale blue” ?

https://www.salestaxsupport.com/blogs/state/ohio/south-dakota-v-wayfair-threatens-ohio-on-line-guitar-purchase/
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Ohio's True Object Test: How to Tax Bundled Transactions

Confused by what happens when you combine a taxable product with a nontaxable product or service and sell it for one fixed price? Is the transaction taxable or not? Steve Estelle, Esq., of Whalen & Company, CPAs explains the process in OHIO. What’s been your experience with bundled transactions in OHIO - or other states? Have you experienced particular challenges in any particular state?

https://www.salestaxsupport.com/blogs/state/ohio/ohio-tax-true-object-test-and-bundled-transactions-explained/
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Quill Killed: Understanding the WAYFAIR (E-Commerce Tax) Court Decision

If you have heard or read countless references to the recent on-line sale tax decision by the Supreme Court (South Dakota v Wayfair) - this is a helpful post to read. Jerry Donnini of Moffa, Sutton & Donnini, PA - provides some helpful insights. What’s your opinion?

https://www.salestaxsupport.com/blogs/issues/sales-tax-nexus/quill-killed-supreme-court-overrules-physical-presence/

#wayfair #southdakota #wayfairvssouthdakota
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Supreme Court Online Tax Decision: What On-Line Businesses Need to Do NOW!

If you are an online seller of ANY kind or size - and you’ve been hearing the news references these past days to the “South Dakota v Wayfair” case” - or “Quill” - or simply “e-commerce or online tax ruling” - and wondering what the fuss is about. Well… It’s time to sit down and get familiar with the issue NOW. Your world has just changed...

As Mike Fleming (Sales Tax and More) comments in his latest SalesTaxSupport blog post, “Life just got a whole lot tougher for eCommerce sellers.” While this decision is specific to South Dakota, Mike explains that there are more than 20 states which have passed economic nexus statutes, rules, or regulations in anticipation of this ruling - and many of those states will start enforcing right away. Additionally - there are 41 states (plus DC) which petitioned the court to repeal the Quill decision - and it will be interesting to see what these states will now do.

Mike’s post provides some helpful background on the case (as well as an explanation of the key NEXUS concept which is the heart of this debate) and provides some first impressions of what and how things will change (VERY soon) for on-line sellers. He also provides some practical advice about what you need to do NOW! BTW - Mike will be preparing updates on this extremely important issue - and he welcomes your questions and comments.

Have you been tracking this ongoing “internet tax” issue - and do you understand what you need to start doing immediately - given this landmark tax decision? Do you have an action plan?

https://www.salestaxsupport.com/blogs/industry/small-business-ecommerce/with-quill-dead-you-could-now-have-sales-tax-nexus-everywhere/
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Texas Brewers - or Businesses with Returnable Containers? It’s time to take a stand!

Texas has a tax issue which many brewers (or other companies with returnable containers) may not even be aware of - and that is the “returnable containers issue”.

In reading the appropriate sections of the TEXAS tax code (which can be viewed by accessing link to referenced post) one would rightly interpret that kegs would qualify as exempt wrapping and packaging purchases by a brewery. After all - the brewing process is complete when the beer is packaged in bottles, cans or kegs, loaded onto pallets and wrapped for shipment and delivery. Unfortunately - there is another section of the tax code that directly contradicts this conclusion. Section (g)(3) of Rule 3.314 states “sales or use tax is not due on returnable containers when sold with the contents in connection with the retail sale of the contents or when resold for refilling. The SELLER must pay sales or use tax on the container at the time of purchase”. And that my friends - is what is known in tax circles as the “returnable containers” issue.

This issue has been argued and challenged (unsuccessfully) in Texas Administrative Court. Many industries that have returnable containers (bottled water processors, oxygen and other gas distributors, etc.) have also challenged the issue. However - we are now talking about BEER - and it is time to take a stand!

Susan Goertz (of Brown Goertz & Co) believes that the 1984 East Texas Oxygen Co ruling is wrong and should be overturned. Her firm is partnering with other sales and use tax professionals in Texas to start the conversation about important next steps - and she welcomes your comments, questions - and voices.

What are your thoughts? Have you had experience with this tax issue in TEXAS - or have you experienced similar situations in other states?

https://www.salestaxsupport.com/blogs/state/texas/taxing-tx-brewers-overturn-returnable-containers-law/
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DROP-SHIP Tax Strategies? Registering in a single state to ease RESALE CERTIFICATE issue? Not so fast…

If you are active in any e-commerce activity - you already know what DROPSHIPPING is - and most likely understand the challenges associated with resale/exemption certificates. However for NEW SELLERS - it can be a confusing nightmare. Mike Fleming (Sales Tax and More) just launched a new DROP-SHIPPING blog - which provides a great overview of key DROP-SHIP considerations. Mike also explains how some sellers consider certain strategic approaches to ease tax/documentation issues - such as registering in a single no-sales-tax state. Mike explains why such approaches may NOT be wise…

What DROP SHIP related issues have you experienced - and/or are there issues that you think should be covered?

https://www.salestaxsupport.com/blogs/industry/drop-shipping/sales-tax-on-drop-ship-where-new-sellers-go-wrong/
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SALES TAX AUDIT: Can you manage your own audit?

According to Andy Johnson, CPA of Peisner Johnson & Company - when it comes to the odds of being audited by a state for sales tax, it’s not a case of if, but when - so its best to prepare.

As an assist to small and medium businesses - Andy has created a series of SALES TAX AUDIT posts. While it’s always best to have an experienced tax professional involved - there is much you can do to manage your own audit - and to keep the assessment to a minimum.

Andy plans to address key issues - and clearly explain what you should (or should NOT) do for each… His first post addresses the much dreaded AUDIT NOTIFICATION LETTER.

Any audit tips to share - or specific issues - you think Andy needs to add to his list?

https://salestaxsupport.com/blogs/issues/audits/sales-tax-audits-best-to-prepare/
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Sales Tax Audits - A case of NOT IF - but WHEN...

According to Andy Johnson of Peisner Johnson & Company - when it comes to the odds of being audited by a state for sales tax, it really is a case of WHEN… Given that grim reality - Andy has penned a series of new SALES TAX AUDIT posts to help the small/medium business navigate this process - and keep any resulting assessment to a minimum.

Andy will be publishing a series of posts - one per week to address key SALES TAX AUDIT issues. Any particular items you’d like to see included?

https://www.salestaxsupport.com/blogs/issues/audits/sales-tax-audits-best-to-prepare/
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