{"id":2879,"date":"2018-12-19T13:38:06","date_gmt":"2018-12-19T18:38:06","guid":{"rendered":"http:\/\/keysolutions.us\/blog\/?p=2879"},"modified":"2018-12-19T13:38:06","modified_gmt":"2018-12-19T18:38:06","slug":"new-jersey-and-pennsylvania-reaction-to-wayfair-decision-on-nexus-thresholds","status":"publish","type":"post","link":"https:\/\/keysolutions.us\/blog\/new-jersey-and-pennsylvania-reaction-to-wayfair-decision-on-nexus-thresholds\/","title":{"rendered":"New Jersey and Pennsylvania Reaction to Wayfair Decision on Nexus Thresholds"},"content":{"rendered":"

New Jersey and Pennsylvania React to Wayfair Decision on Nexus Thresholds<\/strong><\/span><\/h1>\n

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NJ & PA React to U.S. Supreme Court Wayfair Decision<\/em><\/strong><\/span><\/h2>\n

Our July 24, 2018 blog<\/a> alerted our readers to the U.S. Supreme Court\u2019s landmark decision that physical presence is no longer required for a state taxing authority to find that a company has sufficient contact with that state to make it subject to the state\u2019s sales tax reporting requirements. Wayfair <\/em>was an out-of-state retailer that South Dakota successfully prevailed at the U.S. Supreme Court in finding that it had sufficient nexus (contact with the state) to make it subject to South Dakota\u2019s sales and use taxes.<\/p>\n

South Dakota\u2019s threshold for finding nexus was that the out-of-state retailer had at least $100,000 in sales delivered to the state or the retailer had at least 200 transactions in a year in the state. We noted in our blog that the Supreme Court did not rule whether these amounts were a required threshold or simply indicative of substantial nexus. We had forewarned our readers that states may push the envelope by implementing lower thresholds than S. Dakota did. Let’s look at how two states have reacted.<\/p>\n

New Jersey has ruled that effective November 1, 2018<\/strong>, sellers of property, specified digital products and taxable services that meet NJ\u2019s threshold must collect sale tax or comply with the use tax notice and reporting requirements for non-collecting sellers.<\/p>\n

What is the NJ threshold? Nexus is triggered if the seller had gross revenues of more than $100,000 OR 200 or more separate transactions in the state in the current or prior calendar year. <\/strong><\/p>\n

Pennsylvania has ruled that effective March 1, 2018<\/strong>, referrers, remote sellers, and marketplace facilitators that meet PA\u2019s threshold must collect sale tax or comply with the use tax notice and reporting requirements for non-collecting sellers.<\/p>\n

What is the PA threshold? Nexus is triggered if the seller had taxable sales in PA of $10,000 or more in the previous calendar year. <\/strong><\/p>\n

If your company transacts business in states other than your home state (state of domicile), you may become taxable in those other states due to the Wayfair decision that eliminated the physical presence test and propelled states to change their nexus rules.<\/p>\n

If one looks at NJ and PA, one can appreciate the challenges businesses will face in determining nexus on a state-by-state basis. Some of the challenges highlighted by these two states are:<\/p>\n