State taxing authorities are beginning to issue more guidance on recently-enacted remote seller and marketplace nexus laws. In Massachusetts, the Department of Revenue has issued FAQs for remote sellers for periods ending before October 1, 2019 and FAQs for remote sellers and marketplace facilitators effective October 1, 2019. Recall for periods before October 1, 2019, a remote retailer was required to collect and remit sales and use taxes if the seller had the requisite “in-state physical presence,” which was generally defined to include having apps and cookies in the state or having relationships with in-state content distribution networks. The remote retailer was also required to meet a sales threshold of more than $500,000 in Massachusetts sales from transactions completed over the Internet as well as delivery into Massachusetts of 100 or more transactions. Beginning October 1, 2019, remote sellers and marketplace facilitators must collect tax on sales of tangible personal property and taxable services if they have Massachusetts sales that exceed $100,000 in a calendar year. The FAQs will be added to from time to time and interested taxpayers can register to be automatically notified of future developments.
In Alabama, the Department of Revenue has also issued FAQs addressing the obligations of remote sellers and marketplace facilitators. The FAQs provide that in-state sellers who exclusively sell through a marketplace do not need to register with the Department, but instead should apply for an exemption certificate. Further, remote sellers and marketplace facilitators are required to collect only the 8 percent simplified sellers use tax, and are not required to collect and remit any additional state and local taxes.
In Louisiana, the Louisiana Sales and Use Tax Commission for Remote Sellers issued a Draft Notice of Intent in which it proposes adopt a regulation mandating “electronic filing of all remote seller tax returns and electronic payment of all related sales and use tax” for tax periods beginning on or after July 1, 2020. Recall, under House Bill 547, the Commission was required to set an enforcement date of no later than July 1, 2020 and publish a notice of enforcement no later than 30 days prior to the enforcement date of the state’s economic nexus remote seller law.
In other news, the two bills have been pre-filed in the Florida legislature (Senate Bill 126 and House Bill 159) that, if enacted, would impose a sales and use tax collection obligation on remote sellers and marketplace facilitators with more than $100,000 in sales or 200 or more retail transactions of tangible personal property. Please stay tuned to TWIST for future Wayfair related updates.
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