Sales Tax Nexus Assessment Tool

Maintaining tax compliance as an online business can be difficult, especially when you’re selling to customers across the country in different states than your own. Tax laws are constantly changing, and many states have their own unique tax laws that require online businesses to collect sales tax, even if the business is not physically located in that state. This is referred to as “economic nexus;” some states have an economic nexus threshold, meaning that any business that makes a certain amount of sales within that state needs to register, remit, and collect sales tax on those sales. It can be difficult to navigate which states you’ve reached the economic nexus threshold in, and which states you’re getting close to reaching – not to mention keeping up with new tax laws as they come into effect.

Avalara is software designed to automate tax compliance for businesses. While Avalara’s automated tax software isn’t free, they do provide a free business tool specifically for online businesses to aid in their state-by-state tax calculation. The Avalara Sales Tax Risk Assessment Tool helps you to track down any states that you’ve triggered economic nexus and need to collect sales tax in, as well as states that you’re close to reaching a threshold in. The tool provides you with a custom PDF report on each state where your sales have likely triggered a sales tax obligation, along with a guide on how to resolve those obligations. With this tool, you’ll be able to keep your online business 100% compliant in every state you do business in and avoid any tax issues