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New Update from NY State Tax Department Regarding Sales by Out of State Sellers and Guidance from Other States

In response to last year’s U. S. Supreme Court decision, South Dakota v. Wayfair, Inc., which ruled that states can impose sales tax collection responsibilities on businesses even if they don’t have a physical presence in their state, many states have amended their laws and issued guidance.

The New York State Department of Taxation and Finance recently issued TSB-M 19(4) S which provides guidance regarding sales tax registration and collection requirements for business that have no physical presence in New York State. The memorandum provides that, in accordance with recent changes to the tax law, a business which has no physical presence in New York State is required to register as a sales tax vendor and collect and timely remit the applicable state and local sales tax if, in the prior four sales tax quarters, it has:

  • made more than $500,000 in sales of tangible personal property delivered in the state, and
  • conducted more than 100 sales of tangible personal property delivered in the state.

The sales tax quarters are: March 1 through May 31, June 1 through August 31, September 1 through November 30, and December 1 through February 28/29. If you are a business that meets this threshold, but has not yet registered as a vendor, you should do so now.

The guidance also provides relief from penalties and interest to taxpayers with no physical presence that registered for sales tax but may have collected and remitted the wrong amount.

Other states have issued similar guidance, each with varying thresholds for sales and transactions. Details are provided here. If your business has customers in multiple states you may have a sales tax registration and filing requirement in those states even if you do not a have a physical presence in them.

For more information and to insure that your business is in compliance with all state filing and registration responsibilities, please contact your Janover professional.


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