Avalara Resource Center

Sales Tax Nexus

What is sales tax nexus?

Sales tax nexus is the connection between a seller and a state that requires the seller to collect and remit tax on sales made in that state. If you have nexus in California and Texas, for example, you must collect and remit sales tax in California and Texas.

Many states are expanding their nexus rules. Business activities like trade show attendance, drop shipping, employing remote workers, advertising, and housing inventory in other states can establish nexus. The rules vary by state and it can be challenging to keep up with all the places your business needs to register, collect, and remit sales tax. Need expert help in determining your nexus obligations? Our professional services team can help.

Find out where to collect and remit sales tax

Each state where you do business has its own nexus laws. So determining where your business has nexus can be complicated and time consuming. Many states have also expanded their definitions of nexus in recent years, so it’s important to stay up to date with recent legislation. Use our resources to learn more and help determine where your business has nexus.

Learn nexus rules for ecommerce sellers

Online sellers can generate sales tax nexus through a range of selling activities, even with just a few employees. Even if you have company with a single location — say, a California garage — you may be expected to pay sales tax in a dozen states or more, just from making a few small changes to how your products are shipped and sold. Use our resources to understand your nexus requirements as an online or out-of-state seller.