In recent news, both Indiana and Wyoming have eliminated the use of transaction counts (200) as a factor in determining sales and use tax nexus for remote sellers. This is a significant change that will affect many businesses operating in these states.
What Is Sales and Use Tax Nexus?
For those who may not be familiar, sales and use tax nexus refers to the connection between a business and a state that allows the state to require the business to collect and remit sales tax on transactions made within that state. In the past, many states, including Indiana and Wyoming, used transaction counts as a means of determining if a remote seller had established nexus within their borders.
Recent Changes
However, this method of determination has come under scrutiny in recent years, with many arguing that it places an unfair burden on small businesses that may only make a few sales within a state. In response to these concerns, both Indiana and Wyoming have now eliminated transaction counts as a factor in determining sales and use tax nexus for remote sellers.
This is good news for many businesses, as it means they will only be required to collect and remit sales tax if they meet other criteria, such as having a physical presence within the state or exceeding a specific dollar amount of sales, currently $100,000.00 in both Indiana and Wyoming.
*Please note that Indiana’s updated nexus threshold is retroactive to January 1, 2024, and Wyoming’s does not take effect until July 1, 2024.
Let Thompson Tax Help
Although the recent change has made the nexus process less burdensome, the process still has its challenges. Businesses operating in different states still need to be mindful of each state’s sales tax laws to ensure that they collect and remit the correct amount of tax for each transaction.
Do you have Nexus questions? Contact Thompson Tax today to see how we can help. We have your sales and use tax needs covered from A to Z.
Let us be your Trusted Tax Advisor.