How Has the New York Economic Nexus Changed?

Andrew Decker
October 27, 2020

Many states have started making changes to how they collect and remit state and local sales tax following the South Dakota v. Wayfair, Inc. decision. However, the New York economic nexus changed more quickly than others. New York made its enforcement date June 21, 2018 – the same day as the Wayfair ruling. The state also initially set its sales threshold at $300,000, but has since adjusted that to $500,000. Below, we outline some of the larger points to New York’s sales and use tax nexus guidance.

Enforcement date:
June 21, 2018.

Sales/transactions threshold:
$500,000 and 100 transactions.

Measurement period:
The previous four sales tax quarters.

Included transactions/sales:
Retail sales of tangible personal property delivered into the state. Sales made through a registered marketplace facilitator are not included, but sales made through a non-collecting marketplace are included.

When You Need to Register Once You Exceed the Threshold:
Within 30 days after meeting the threshold, begin to collect tax 20 days afterwards.

Summary: A business that has no physical presence in New York is required to register as a sales tax vendor and collect and timely remit the applicable state and local sales tax if in the immediately preceding four sales tax quarters it has made more than $500,000 in sales of tangible personal property delivered in the state, and conducted more than 100 sales of tangible personal property delivered in the state. The sales tax quarters are: March 1 through May 31, June 1 through August 31, September 1 through November 30, and December 1 through February 28/29. Additionally, the New York Department of Taxation and Finance states that “a business with no physical presence in the state that registered for sales tax because of the Tax Law provisions…and, in good faith, collected and remitted sales tax at an incorrect local rate, must pay the additional local sales tax due but is not liable for penalty and interest on the additional local tax. This relief applies only to sales made during the first four quarterly periods after the business was required to register.”

New York has continued to make small adjustments to its economic nexus laws, even in the wake of the Wayfair decision. But remote sellers and marketplace facilitators do not need to operate in a constant state of distress. We have the right experts to help with your sales and use tax process.

New York Sales Tax Resources: For more information contact our team. Or, swing on over to our interactive sales tax nexus map and read the most up-to-date information on other states.

Take Action

Check out our workshop on how to file your New York state sales tax return.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.


Andrew Decker

Andrew Decker is a Senior Regulatroy Counsel at Sovos Compliance. Within Sovo’s Regulatory Analysis function, Andrew focuses on international VAT and GST issues and domestic sales tax issues. Andrew received a B.A. in Economics from Bates College and J.D. at Northeastern University School of Law. Andrew is a member of the Massachusetts Bar.
Share This Post

North America ShipCompliant
May 25, 2023
Out-of-State Breweries Gain Self Distribution, DtC Rights in Oregon

Under a settlement agreement, breweries located outside of Oregon now have more options for selling into the Beaver State, including direct-to-consumer (DtC) shipping and self-distribution to retailers. The settlement arose out of a lawsuit filed by a group of Washington breweries last year challenging Oregon laws that limited beer self-distribution to in-state breweries and DtC […]

EMEA VAT & Fiscal Reporting
May 24, 2023
VAT and Art: What you need to know

Significant inflation increases have impacted most of the world’s economies, with the UK still above 10% in 2023. This increase means a reduction in the purchasing power of consumers. Together with increases in the cost of raw materials, this has created uncertainty regarding growth of entire industrial departments and reduced profit margins for companies. The […]

North America ShipCompliant
May 23, 2023
Top 5 Myths Surrounding Retailer Direct-to-Consumer Wine Shipping

By Tom Wark, Executive Director, National Association of Wine Retailers Politics breed myths. This has always been the case as politics is, at its most fundamental, a form of storytelling. So it should be no surprise that myths have arisen as various elements of the wine industry have fought against consumers and specialty wine retailer seeking […]

May 23, 2023
IPT: Location of Risk and Territoriality

Much of the discussion on the Location of Risk triggering a country’s entitlement to levy insurance premium tax (IPT) and parafiscal charges focuses on the rules for different types of insurance. European Union (EU) Directive 2009/138/EC (Solvency II) set out these rules. However, a related topic of growing importance in this area concerns territoriality, i.e. […]

Asia Pacific E-Invoicing Compliance
May 23, 2023
Japan: New e-Invoice Retention Requirements

Japan’s new e-invoice retention requirements are part of the country’s latest Electronic Record Retention Law (ERRL) reform. Along with measures such as the Qualified Invoice System (QIS) and the possibility to issue and send invoices electronically via PEPPOL, Japan is implementing different indirect tax control measures, seeking to reduce tax evasion and promote digital transformation. […]