State-by-State Guide to Sales Tax Nexus Laws

There are currently more than 12,000 state and local tax jurisdictions across the 50 states. These regulations can change quickly and without notice. This guide is intended to keep sellers current on all economic nexus laws surrounding the collection of sales tax.
State-by-state guide

This interactive map is updated continuously to help ensure you are remaining compliant in all states in which you conduct business. Scroll through the map to learn which nexus tax laws may have changed.

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STATE INFO

Vendor Assessment

IDC MarketScape Names Sovos a Leader in Sales Tax and VAT Automation Applications

IDC MarketScape highlights:

IDC MarketScape Worldwide SaaS and Cloud-Enabled Sales Tax and VAT Automation Applications 2019 Vendor Assessment named Sovos a leader for our global presence and coverage, strong cloud platform, and e-invoicing compliance solution. Read the brief now.

“Sovos offers these organizations tremendous value by providing coverage for every form of transaction-level tax compliance in one solution.” –Kevin Permenter, Research Manager, IDC

Here’s what the IDC MarketScape measures:

  • Overall market evaluation and assessment of tax automation applications
  • Insights for selecting a vendor based on your organization’s requirements
  • Strengths, challenges and considerations when deploying tax automation applications
IDC MarketScape Worldwide SaaS and Cloud-Enabled Sales Tax and VAT Automation Applications 2019

Understanding State IRA Withholding Requirements

IRA withholding remitting, reporting and reconciling can be difficult for organizations to manage at a federal level, but it gets even more complicated when you add states to the mix. Each state has their own remitting and reporting frequencies, thresholds, requirements and penalty structures. Because of this, it can be hard to determine if and when state withholding is required on a state-by-state basis.

This map breaks down where IRA withholding remitting and reporting is mandatory, verses being voluntary or not required, on a state-by-state basis to help organizations understand their IRA state withholding requirements.

 

Centralizing and automating manual withholding processes has allowed organizations to improve operational efficiency by up to 92% allowing resources to focus on business critical tasks while mitigating process, compliance and security risk. Find out how Sovos can help.

Italy: Electronic Invoicing and Reporting Requirements

Seeking to close a 35 billion euro tax gap, Italy has implemented a clearance e-invoicing model for domestic transactions. Get the details in the mandate and the requirements it involves with this guide.

Automate Unclaimed Property Compliance with a Hosted Solution

Complying with regulations regarding unclaimed property is extremely complex and can quickly turn into a huge hassle for employees in tax, finance, accounting, and legal departments. Learn how an automated solution can help.

Infographic: State 1099 Reporting Deadlines

By far, the biggest challenge facing organizations during 1099 reporting season this year was state reporting. With states tightening deadlines and multiple jurisdictions and reporting thresholds to deal with, Sovos customers found state reporting more complex than any other element of reporting season.

This updated infographic shows why. The map shows 1099 reporting deadlines by earliest deadline per state. In just a few years, the vast majority of 1099 first deadlines have shifted from March to January. Combine that shift with changing thresholds for 1099-K forms and other state-specific policies, and it is clear why state reporting has become such a challenge and will likely continue to be.

 

With reporting periods shrinking, organizations need to centralize and automate reporting processes in order to maximize efficiency, ensure compliance and avoid financial penalties.
Find out how Sovos can help.

Brazil: Electronic Invoicing and Reporting Requirements

In 2008, Brazil adopted a clearance electronic invoicing model in which the country’s tax authority must receive and clear an invoice before a supplier can issue it to a payer. More than a decade later, the Brazilian tax administration’s digitization has evolved so much that other tax administrations call Brazil the Google of fiscal goods. 

Current regulations include electronic invoices for: supplies of goods (NF-e), services (NFS-e), transport services (CT-e), freight (MDF-e), SPED, REINF and, more recently, for the supply of electricity (NF3e). 

This document provides an overview of the mandates and regulations in Brazil.

Mexico: Electronic Invoicing and Reporting Requirements

Mexico is a pioneer in electronic invoicing and VAT enforcement, having begun its digitization journey in 2010. Today, Mexico has one of the most technologically advanced tax administrations in the world. Companies unaware of or unprepared for Mexican e-invoicing mandates could face significant fines and penalties, along with supply-chain disruptions and cash-flow issues. This document provides an overview of mandates and regulations in Mexico.

Why Partner with a Certified Service Provider (CSP) for Sales Tax Administration

Certified Service Providers (CSPs) allow businesses to outsource most sales tax administration responsibilities, making it easier to comply with the laws of a given jurisdiction.

Choosing a CSP to manage your sales tax filings reduces the burden of managing end-to-end sales tax compliance while reducing organizational liability during the tax calculation process.

VAT Talks – Christiaan van der Valk, VP, Strategy talks to Summitto

In a recent VAT Talks interview with Summitto, Christiaan discussed the importance of e-invoicing, the future of VAT and technology and why companies operating in Europe should embrace real-time reporting.

Solve Tax for Good in SAP® Solutions

SAP leaders have been challenged to enable business transformation with a migration to S/4HANA.
At the same time, state and local governments have embarked on a digital transformation of their own, requiring companies to provide more data on sales and purchases. Keeping pace with regulatory changes while maintaining patchwork processes across the business during the migration can put an additional strain on resources and ratchet up the pressure.

True End-to-End Compliance

Getting sales and use tax right shouldn’t be this hard, so Sovos provides a fully integrated solution to systematically manage your sales and use tax processes. We address your most pressing and time-consuming issues quickly and seamlessly, allowing tax & finance professionals to focus on creating revenue streams, scaling operations and growing your business.

The Industry Leader in Tax and Regulatory Reporting

Last year, Sovos promised insurers we would Solve Tax for Good®. A year later, we have helped thousands of insurers ease the burden and risk of modern tax and regulatory compliance. We have kept our promise by helping insurers stay ahead of the Tax Cuts and Jobs Act, SECURE Act and all other tax and regulatory changes. 

As part of our commitment to insurance professionals, we acquired statutory reporting market leaders Eagle Technology Management (ETM) and Booke Seminars in 2019 and 2020, respectively. We are now the market leader in statutory reporting. More than 70 percent of the U.S. insurance market uses our compliance software and educational resources. With the acquisition of ETM, Sovos also adds insurance premium tax and unclaimed property compliance to its portfolio of solutions. By acquiring Booke Seminars, Sovos adds statutory education and federal income tax filing software.

Statutory Reporting

Complying with statutory reporting and state filing requirements is complex and involves several time-consuming tasks. Things like entering and verifying countless schedules, validating and cross-checking data across schedules and submitting filings to the NAIC and state regulators all take vital resources away from your business. We help you eliminate that burden by providing the statutory reporting industry’s leading: 

  • educational seminars
  • handbooks
  • insurance compliance calendar
  • and statutory reporting, municipal tax, insurance premium tax and federal income tax solutions

Unclaimed Property

Every state imposes its own unique unclaimed property regulations. And changes occur daily. As a result, officials estimate that 80 percent of all businesses are out of compliance with unclaimed property laws. But not keeping track can quickly catch up with you. Fines, penalties, interest and misdemeanor charges can place a massive financial burden on your business. And if fraud is discovered, your business’s reputation will take a hit. Sovos’ Unclaimed Property solutions streamline the reporting process, safeguard businesses from audit risk and have processed more than $8.5 billion of unclaimed property on behalf of our customers.

Tax Information Reporting and Withholding

Every year, Sovos reports 620 million tax forms, making us the #1 private filer of 10-series forms filed to the IRS. Insurers have relied on our wide breadth of tax information reporting solutions  for over 30 years. Sovos’ tax information reporting, withholding management and tax identity management solutions reduce manual work by up to 90%. This empowers insurers to focus on their most important business goals while ensuring compliance.

About Sovos

Sovos is a leading global provider of software that safeguards insurers from the burden and risk of modern tax. As tax goes digital, businesses face increased risks, costs and complexity. The Sovos Intelligent Compliance Cloud is the first complete solution for modern tax, giving businesses a global solution for tax determination, e-invoicing compliance, tax and regulatory reporting. Sovos supports more than 7,000 customers, including 70 percent of the U.S. insurance market, and integrates with a wide variety of business applications. We have offices throughout North America, Latin America and Europe. Sovos is owned by London-based Hg.

Infographic: How Does Your E-Archive Stand Up?

With governments around the world digitising tax, companies are now under greater pressure than ever to ensure they are audit ready, all the time.

We’ve pulled together a quick checklist for you to cross-reference to see – Is your e-archive compliant?

Executive Summary: Reducing the Impact of Sales and Use Tax Compliance in the New Retail Environment

Aberdeen Group survey report reveals complex challenges retailers face today in sales and use tax compliance and provides a roadmap to navigate the increased complexity to come.

Sales and Use Tax Study for Software Organizations – Executive Summary of Aberdeen Data

Regardless of size, today’s software organizations are significantly challenged in the quest for Sales and Use Tax (SUT) compliance, as they continue to evolve their businesses, create new product offerings, explore new business channels and expand geographically.

Analyst Report

IDC’s Quick Take On Sovos Use Tax Manager

On March 5, 2018, Sovos announced a new cloud solution for use tax. The solution automates use tax determination for purchases. The product was demonstrated at the SAP Ariba Live event which was held March 5-7 in Las Vegas, Nevada. The announcement adds more fuel to the rapidly growing cloud tax automation software market.

Streamlined Sales Tax Volunteer Seller Assessment

ASSESSMENT

Six Questions to Assess your Volunteer Seller Status

This assessment is designed to help you determine whether you qualify for Volunteer Seller Status, which reduces your sales tax risk, burden and costs, in one or more of the 24 Streamlined Sales Tax (SST) states.

Qualifying as a Volunteer Seller allows you to benefit from reduced risk, burden, and cost when you partner with Sovos as your Certified Service Provider (CSP) for sales tax compliance. This partnership enables you to outsource most administrative compliance processes, saving time while maintaining confidence in the accuracy of your sales tax data. 

The below legal definitions should be referenced when utilizing this assessment.

Six Questions to Assess your Volunteer Seller Status

In answering these questions, remember that a company’s status as a “Volunteer Seller” is evaluated on a state-by-state basis, meaning your inability to qualify in State A (e.g. Kentucky) does not impact your ability to qualify in State B (e.g. Rhode Island). As such, consider each of the Streamlined Sales Tax states separately as you answer the following questions.

DEFINITION

What is the legal definition of Property?

  • “Property” is the Average Value of the Seller’s real property and tangible personal property owned or rented by the Seller.
  • Property owned by the Seller is valued at its original cost basis.
  • Property rented by the Seller is valued at eight times the net annual rental rate.
  • Net annual rental rate is the annual rental rate paid by the Seller less any annual rental rate received by the Seller from sub-rentals.
  • The “Average Value” of Property shall be determined by averaging the values at the beginning and end of the twelve (12) month period immediately preceding the date of registration with the Streamlined State.
DEFINITION

What is the legal definition of Payroll?

  • “Payroll” is the total amount paid by the Seller for Compensation during the twelve (12) month period immediately preceding the date of registration with the Streamlined State.
  • “Compensation” means wages, salaries, commissions and any other form of remuneration paid to employees and defined as gross income under Internal Revenue Code §61.
  • Compensation is paid in a Streamlined State if (1) the individual’s service is performed entirely within the Streamlined State, (2) the individual’s service is performed both within and outside the Streamlined State, but the service performed outside the Streamlined State is incidental to the individual’s service within the Streamlined State, or
  • (3) some of the service is performed in the Streamlined State and (a) the base of operations, or if there is no base of operations, the place from which the service is directed or controlled, is in the Streamlined State, or (b) the base of operations or the place from which the service is directed or controlled is not in any state in which some part of the service is performed, but the individual’s residence is in the Streamlined State