Major points that Sales Tax Experts are in agreement on: 

• This is NOT just about eCommerce transactions.  The prior standard of "Physical Nexus" established in 1992 has just been overturned. 
• The likelihood of this ruling being reversed based on the "undue burden" clause is unlikely, since a minimum transaction threshold is incorporated in the legislation being upheld. 
• Sales destination monitoring for the purposes of Sales Tax Compliance just became a basic requirement of every business in the country. 
• 15 States now have non-physcial Nexus rules that are likely to be upheld in a court of law. 
• There will almost certainly be more states passing legislation based on Economic Nexus
• Business' have time to perform due diligence and put solutions in place. 
• Companies need to review their data for potential liabilities and be proactive in addressing this change.  Most states who find violations due to an audit have a multiple year look back period that is often limited by voluntary registration.  
• Exemption certificate maintenance (resale or exempt buyers) become more critical! 

What you should do...  sooner rather than later. 

Depending on the complexity of your product line, and the number of locations you are shipping to, your strategy may be simple or complex.  We have been working on solutions to the growing complexity in sales tax reporting and collection for some time now, and are ready to assist you with varying degrees of software solutions and assistance.  

There appears to be one clear starting point for all of us: Determining which states we are selling goods into, what the number of transactions has been, and what the total dollar volume has been.

We are modifying the AR Invoice Summary report 'right now' to enable you to simply run a report in your AccountMate system to obtain the necessary figures for any date range needed. We're offering this report at a "shared programming cost" of $199 for our AMSQL 9 and AMSQL 10 customers, and it will be available within days. Clients on other versions who are interested, please contact us to discuss pricing options. 

We also have the following resources to help you:

• links to the registration website for any states you will need to register in
• Thresholds listing for the 15 states with existing Economic Nexus legislation
• Export routine to send data to a Tax Service for filing of returns if the risk or error or labor burden is too high 'in house'. (contact us for a custom quote for the software and service available) 
• A soon to be completed, integrated sales tax solution with a reputable service to make the sales tax functionality within AccountMate robust enough to handle a high number of states where your company may find you now have Nexus. This solution will help ensure you are collecting, reporting and remitting the proper sales tax based on your customer address'.  

Nexus Definitions

Physical Nexus:  The prior 'standard' of establishing if a business has a physical office, warehouse or sales force in a state to determine if the seller has the responsibility to collect tax in that state. 

Economic Nexus: Generally correlates with a set level of sales or gross receipts activity within the state. No physical presence is required.

Marketplace Nexus: If an online marketplace operates its business in a state and provides e-commerce infrastructure as well as customer service, payment processing services and marketing, the marketplace facilitator is required to register and collect tax as the retailer rather than the individual sellers. This could also impose reporting requirements on the marketplace facilitator.

Click-Through Nexus: If a retailer or service provider contracts with an individual or company located in-state who directly or indirectly refers potential customers to the retailer through a web link for a commission/other consideration upon sale, the retailer is considered to maintain a place of business in that state. Thresholds apply and vary by state. Pay-per-click, banner and other advertising do not qualify if payment is not contingent upon a sale.

Affiliate Nexus: If an affiliated person of the retailer with a physical presence, or employees or agents in state, has sufficient nexus in state to require the retailer to collect and remit sales and use taxes on taxable retail sales of tangible personal property or services. Some states have expanded these provisions to include activities by unrelated parties performed on the seller’s behalf.

Reporting Requirements: Retailer must notify buyers that they must pay and report state use tax on their purchases. Retailer may be required to send purchasers an annual statement of all of their purchases from the retailer.