Wayfair State Sales Tax Update

While CPAs have been enjoying their summer taking long vacations, states have been very busy at work asserting their positions regarding the impact of South Dakota v. Wayfair. Many professionals assumed that since the majority of state legislatures have adjourned for 2018 that we would not get significant guidance from states, but that has not been the case. In the last two weeks of July alone, 12 states have come out and announced legislative or administrative changes. Some states have implemented rules that will be effective on 10/1/18.

States That Have Announced Enforcement Dates:

As of 9/1/18
Mississippi
As of 11/1/18
North Carolina
As of 1/1/19
Nebraska
Utah

 

 

 

 

As CPAs come back from their summer breaks they may be facing a challenge where a client was required to collect sales tax as of July 1, 2018, but missed the deadline. As a reminder, most of the thresholds to determine if a remote seller is required to collect sales tax in 2018 is based on sales from 2017 or 2018.

How Should CPAs Handle These Situations?

Step 1: request a list of sales by states for clients from 2017 and 2018
Step 2: For any state where the client has sales that exceed $100,000 in sales or 200 transactions, you must review that state and be aware of the state’s requirements
Step 3: Determine taxability of items if applicable
Step 4: Register for sales tax license in the appropriate states
Step 5: Assist clients with sales tax automation if required

In order for us to assist our Trusted CPA Partners, PMBA is tracking these rule changes on a real-time basis. We can assist our CPA Partners with this analysis or offer the service directly to their clients.