Remote Sellers
A remote seller is a business that sells products or services to customers in a state without having a physical presence in that state. Remote sellers typically conduct sales through e-commerce, online marketplaces, or mail-order catalogs.
Significance of Remote Sellers in U.S. Sales Tax
- Economic Nexus Rules Apply
- Following the 2018 South Dakota v. Wayfair, Inc. decision, states can require remote sellers to collect and remit sales tax if they exceed a certain economic nexus threshold (typically based on sales revenue or transaction volume).
- Each state sets its own economic nexus thresholds (e.g., $100,000 in sales or 200 transactions in a state).
- No Physical Presence Required
- Unlike physical nexus, which is triggered by having a warehouse, office, or employees in a state, remote sellers can have sales tax obligations purely based on sales volume.
Some states offer alternative tax programs for remote sellers, such as:
- Alabama’s SSUT (Simplified Sellers Use Tax)
- Colorado’s SUTS (Sales and Use Tax System)
- States with Marketplace Facilitator Laws, where platforms like Amazon and eBay collect tax on your behalf.
Indicating remote seller status may direct you to special registration portals or tax rates.