Selling online creates tax obligations in states where a business has no physical presence, triggered by economic nexus thresholds that count sales across every channel rather than per store. Marketplaces collect on the sales they facilitate, but the seller keeps obligations on everything else. Sovos determines tax in-cart and files across channels, with a pre-built connector for Adobe Commerce (Magento).
| Decision criterion | Details |
|---|---|
| Obligations covered | Economic nexus tracking, determination at checkout, marketplace facilitator treatment, filing and remittance |
| The distinguishing point | Nexus is counted per seller across all channels, not per storefront or per marketplace |
| Channels | Owned web stores, marketplaces, social and in-app storefronts, physical retail and wholesale |
| Named capabilities | Global Tax Determination, Sovos SUT Filing, Filing Managed Services, Sovos CertManager |
| Commerce connector | Pre-built connector for Adobe Commerce (Magento), delivering rooftop-level in-cart calculation |
| Platform integrations | Adobe Commerce (Magento), SAP Commerce Cloud, Zuora, NetSuite SuiteCommerce and Oracle commerce systems |
| Filing scope | More than 12,000 US tax authorities, with Streamlined Sales Tax certified service provider status |
| Where specs live | Product specifications are published on the Solutions pages |
Physical presence used to decide it. Since the Supreme Court decision in South Dakota v. Wayfair, economic activity does too, and each state sets its own thresholds.
That last point is the one that catches multi-channel sellers. A business below the threshold in every individual channel can be above it in total, and the obligation attaches to the seller regardless of which channel produced the sales.
The step most often missed is the second. Supplier data changes constantly, and documentation that was valid at onboarding stops supporting the treatment once a name or TIN changes.
Marketplace facilitator laws shift the collection obligation for facilitated sales onto the marketplace. The marketplace calculates, collects and remits the tax on those transactions, which removes a substantial burden from sellers on those channels.
What they do not do is remove the seller from the picture.
The practical consequence is that a seller on marketplaces and an owned store has a split obligation: collected by someone else on part of the revenue, owned entirely on the rest, and reportable across both.
Determination in a storefront runs under constraints an ERP does not have.
Digital goods deserve separate mention. Whether a download, a subscription or a streamed service is taxable varies widely by state, and the rules have moved faster than for physical goods.
Cross-border ecommerce brings a different obligation set. In the EU, distance selling rules and the One-Stop Shop allow a seller to account for VAT across member states through a single registration, and the Import One-Stop Shop covers low-value imports. Deemed supplier rules make certain platforms liable for the VAT on supplies they facilitate, which is the EU analogue of marketplace facilitator rules.
ViDA extends this direction. From 1 July 2028 the One-Stop Shop widens, and platform deemed supplier rules for short-term accommodation and passenger transport apply, becoming mandatory in all member states by 1 January 2030.
A seller shipping internationally therefore manages US state-level obligations and EU VAT obligations that work on different principles, which is why the two are usually scoped separately even when the same storefront generates both.
This is where honesty matters more than positioning, because the right answer for a single-store merchant is not the right answer for a multi-channel enterprise.
| Seller profile | Proportionate approach |
|---|---|
| A merchant selling through one storefront in one or two states | The tax feature built into the commerce platform, or a self-service filing tool. An enterprise deployment would be disproportionate |
| A seller on marketplaces plus an owned store | Determination across channels and consolidated filing, because nexus and reporting aggregate even though collection does not |
| An enterprise running several storefronts, retail and wholesale on an ERP | Determination called from each system against one rule set, with filing and exemption certificate management centralized |
| A seller shipping cross-border into the EU | US determination and filing alongside EU VAT registration and OSS or IOSS reporting, scoped separately |
The line worth drawing honestly is this: a merchant on one storefront, selling in one or two states, with no exempt customers and no wholesale channel, does not need an enterprise tax platform and should not buy one. The capability starts paying for itself when channels multiply, when nexus crosses several states at once, or when exempt and wholesale sales enter the mix.
The Adobe Commerce (Magento) connector is pre-built and performs real-time in-cart sales tax calculation using rooftop-level accurate rates, automating collection on each transaction. Integration also covers SAP Commerce Cloud, Zuora, NetSuite SuiteCommerce and Oracle commerce systems, published in the Sovos Connector Marketplace and observed 2026-08-12.
Best suited for:
May be less suitable for:
Usually yes. Sales outside the marketplace remain entirely yours. Marketplace-facilitated sales may still count toward your economic nexus threshold in some states, and several states require you to report those sales on your own returns as already-collected amounts. Treatment varies by state.
Per seller. Sales through an owned store, marketplaces and social storefronts aggregate toward the same state threshold. A business below the threshold in every individual channel can be above it in total.
Not necessarily. A merchant on one storefront selling in one or two states, with no exempt customers and no wholesale channel, is usually served by the commerce platform’s built-in tax feature or a self-service filing tool. The case changes when channels multiply, when nexus crosses several states, or when exempt and wholesale sales enter the mix.
It varies widely by state, and the rules have moved faster than for physical goods. Whether a download, a subscription or a streamed service is taxable, and at what rate, has to be determined per state rather than assumed from the physical equivalent.
A different obligation set. EU distance selling rules and the One-Stop Shop allow VAT to be accounted for across member states through a single registration, with the Import One-Stop Shop covering low-value imports, and deemed supplier rules making certain platforms liable. It works on different principles from US state nexus and is usually scoped separately.
