You’re required to register for sales tax in a state once you meet either the physical nexus or economic nexus requirements. Physical nexus is created when your business has a presence in a state, such as an office, warehouse, third-party fulfillment center, employees, trade show participation, or even independent contractors or agents. In many cases, simply having remote employees working in another state is sufficient to establish a physical nexus.

Economic nexus, on the other hand, is based on your sales activity. Most states consider you to have economic nexus if your total sales reach $100,000 within a 12-month period, or in some cases, if you complete 200 or more transactions in that state.

Once you meet nexus, you are generally required to register with the state right away, so it’s important to keep track of the exact date this happens. Some states allow a short grace period before you must begin collecting and remitting sales tax, while others—like Arizona—expect you to start immediately. After you register, the state will assign your account start date, filing frequency, and your first return due date, which you can confirm by contacting the state agency.

If you’d prefer to avoid confusion and save time, we can handle the entire process for you. For just $150 per state, we’ll register your business properly and provide you with all the essential details you need, ensuring everything is set up correctly from the start.

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