Plain and Simple: Bright Business Insights Summer 2018 | Page 4

RULING SHAKES UP BUSINESS’S SALES & USE TAX LIABILITY
New Nexus Rules to Result from Monumental South Dakota v. Wayfair Case
As a business owner, you probably have more than a few questions
about the U.S. Supreme Court’s South Dakota v. Wayfair decision,
in which the court sided with South Dakota. In short, if you conduct
What Should Business Owners Do Now?
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would happen if you registered versus being caught? In states
business across state lines, be prepared for some major changes.
where risk is high, look at the costs vs. benefits of registering,
pursuing voluntary disclosure or waiting to see what happens.
Here’s how it worked in the past: Even if you sold products or services
to customers in other states, but your business didn’t have a physical
Determine the risks for each state you do business in – what
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If you primarily sell to wholesalers, and you keep good
presence in the state, there was no nexus. That means you weren’t exemption certificate records, you might just need to register
required to comply with the state’s sales and use tax laws. Now, and provide informational reporting to the state. If caught, you
however, if you do business in multiple states, you will be subject to will have to defend the audit, but if your documentation is good,
the reporting requirements of each of those states. But that’s not all. that might be it.
State legislators also say simply having a website could be enough of
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