A plain-language reference guide for businesses selling into the United States.
Last updated: April 17, 2026
What is "nexus" and why does it matter?
"Nexus" is the legal connection between your business and a state that gives the state the right to require you to register, collect, and remit sales tax on sales into that state. If you have nexus in a state, you generally must:
Register for a sales tax permit in that state.
Collect the correct sales tax from your customers.
File sales tax returns (usually monthly, quarterly, or annually).
Remit (pay) the tax you collected to the state.
There are two main ways to trigger nexus today:
Physical nexus — you have a physical presence in the state (office, employee, inventory, etc.).
Economic nexus — your sales into the state cross a dollar or transaction threshold, even with no physical presence. This became the law of the land after the Supreme Court's 2018 South Dakota v. Wayfair decision.
Key terms used in this guide
Threshold — the dollar amount or number of transactions that triggers economic nexus in a state.
Measurement period — the window of time the state looks at to decide if you crossed the threshold. Usually the "previous or current calendar year" or "previous 12 months."
Gross sales — all sales into the state, including exempt and resale sales (most states use this).
Retail sales — only taxable retail sales, excluding wholesale/resale (some states use this narrower measure).
Marketplace facilitator — a platform like Amazon, Etsy, or Walmart.com that collects and remits sales tax on behalf of third-party sellers. Most states now require marketplaces to collect, which can shift the obligation away from the individual seller.
Effective date — when the state's economic nexus rule started.
How to use the table below
Find each state where you make sales.
Compare your sales (dollars and/or transactions) against that state's threshold.
If you meet or exceed the threshold during the measurement period, you likely have economic nexus and need to register.
Check the marketplace column — if all your sales in a state go through a marketplace that collects on your behalf, your direct obligation may be reduced or eliminated.
Also check physical nexus (see section after the table) — physical presence triggers nexus regardless of sales volume.
Important: Five states have no statewide sales tax and therefore no economic nexus for sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. (Alaska is a special case — see the table.)
Economic nexus thresholds by state (50 states + DC)
State | Economic Nexus Threshold | Measurement Period | Effective Date | Marketplace Facilitator Law | Notes |
Alabama | > $250,000 in retail sales | Previous calendar year | Oct 1, 2018 | Yes (Jan 1, 2019) | Only sales delivered into AL count. No transaction-count test. |
Alaska | $100,000 in gross sales | Previous calendar year | 2020 (by locality) | Yes | No state sales tax, but many local jurisdictions have joined the Alaska Remote Seller Sales Tax Commission. Register once through the Commission. |
Arizona | > $100,000 in gross sales | Current or previous calendar year | Oct 1, 2019 | Yes (Oct 1, 2019) | Threshold dropped from $200K (2019) and $150K (2020) to $100K in 2021. |
Arkansas | > $100,000 in taxable sales or 200+ transactions | Previous or current calendar year | Jul 1, 2019 | Yes (Jul 1, 2019) | Either threshold triggers nexus. |
California | > $500,000 in sales of tangible personal property | Previous or current calendar year | Apr 1, 2019 | Yes (Oct 1, 2019) | Includes sales through marketplaces. Also look at district (local) tax obligations once registered. |
Colorado | > $100,000 in retail sales | Previous or current calendar year | Jun 1, 2019 (enforcement) | Yes (Oct 1, 2019) | Home-rule cities may have separate registration requirements. Use the state's SUTS portal. |
Connecticut | ≥ $100,000 in gross receipts and 200+ transactions | Previous 12-month period ending Sept 30 | Dec 1, 2018 | Yes (Dec 1, 2018) | Both conditions must be met (AND test). |
Delaware | N/A | — | — | — | No state sales tax. (Gross receipts tax applies to businesses doing business in DE.) |
District of Columbia | > $100,000 in gross receipts or 200+ transactions | Previous or current calendar year | Apr 1, 2019 | Yes (Apr 1, 2019) |
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Florida | > $100,000 in taxable retail sales | Previous calendar year | Jul 1, 2021 | Yes (Jul 1, 2021) | No transaction-count test. One of the last states to adopt economic nexus. |
Georgia | > $100,000 in gross sales or 200+ transactions | Previous or current calendar year | Jan 1, 2019 | Yes (Apr 1, 2020) | Threshold lowered from $250K to $100K on Jan 1, 2020. |
Hawaii | ≥ $100,000 in gross income or 200+ transactions | Current or previous calendar year | Jul 1, 2018 | Yes (Jan 1, 2020) | Hawaii uses a general excise tax (GET), not sales tax, but the nexus framework is the same. |
Idaho | > $100,000 in gross sales | Previous or current calendar year | Jun 1, 2019 | Yes (Jun 1, 2019) | No transaction-count test. |
Illinois | ≥ $100,000 in cumulative gross receipts or 200+ transactions | Previous 12-month period | Oct 1, 2018 | Yes (Jan 1, 2020) | Remote sellers owe "use tax"; retailers with IL presence owe Retailers' Occupation Tax (ROT). Different rates can apply — a known IL complexity. |
Indiana | > $100,000 in gross revenue | Previous or current calendar year | Oct 1, 2018 | Yes (Jul 1, 2019) | Transaction-count test (200+) was repealed effective Mar 2024. |
Iowa | ≥ $100,000 in gross revenue | Previous or current calendar year | Jan 1, 2019 | Yes (Jan 1, 2019) | Transaction-count test repealed in 2019. |
Kansas | > $100,000 in gross sales | Previous or current calendar year | Jul 1, 2021 | Yes (Jul 1, 2021) | Earlier, KS tried to enforce with no threshold; statute was updated in 2021. |
Kentucky | > $100,000 in gross receipts or 200+ transactions | Previous or current calendar year | Oct 1, 2018 | Yes (Jul 1, 2019) |
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Louisiana | > $100,000 in gross revenue | Previous or current calendar year | Jul 1, 2020 | Yes (Jul 1, 2020) | Transaction-count test (200+) was repealed Aug 1, 2023. Parishes (local) may require separate registration; use the LA Sales and Use Tax Commission for Remote Sellers. |
Maine | > $100,000 in gross sales | Previous or current calendar year | Jul 1, 2018 | Yes (Oct 1, 2019) | Transaction-count test removed in 2022. |
Maryland | > $100,000 in gross revenue or 200+ transactions | Previous or current calendar year | Oct 1, 2018 | Yes (Oct 1, 2019) |
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Massachusetts | > $100,000 in sales | Previous or current calendar year | Oct 1, 2019 | Yes (Oct 1, 2019) | No transaction-count test. |
Michigan | > $100,000 in gross sales or 200+ transactions | Previous calendar year | Oct 1, 2018 | Yes (Jan 1, 2020) |
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Minnesota | ≥ $100,000 in retail sales or 200+ transactions | Previous 12-month period | Oct 1, 2018 | Yes (Oct 1, 2018) |
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Mississippi | > $250,000 in sales | Previous 12-month period | Sep 1, 2018 | Yes (Jul 1, 2020) | Higher-than-average threshold. |
Missouri | ≥ $100,000 in taxable sales | Previous 12-month period (measured quarterly) | Jan 1, 2023 | Yes (Jan 1, 2023) | MO was the last state to adopt economic nexus. |
Montana | N/A | — | — | — | No state sales tax. A few resort areas have local sales tax; not triggered by remote sales. |
Nebraska | > $100,000 in gross sales or 200+ transactions | Previous or current calendar year | Apr 1, 2019 | Yes (Apr 1, 2019) |
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Nevada | > $100,000 in retail sales or 200+ transactions | Previous or current calendar year | Oct 1, 2018 | Yes (Oct 1, 2019) |
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New Hampshire | N/A | — | — | — | No state sales tax. |
New Jersey | > $100,000 in gross revenue or 200+ transactions | Previous or current calendar year | Nov 1, 2018 | Yes (Nov 1, 2018) |
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New Mexico | ≥ $100,000 in taxable gross receipts | Previous calendar year | Jul 1, 2019 | Yes (Jul 1, 2019) | NM uses a gross receipts tax; nexus framework is equivalent. |
New York | > $500,000 in sales of tangible personal property and > 100 transactions | Previous four sales tax quarters | Jun 21, 2018 | Yes (Jun 1, 2019) | Both conditions must be met (AND test). One of the higher sales thresholds. |
North Carolina | > $100,000 in gross sales | Previous or current calendar year | Nov 1, 2018 | Yes (Feb 1, 2020) | Transaction-count test (200+) was repealed Jul 1, 2024. |
North Dakota | > $100,000 in taxable sales | Previous or current calendar year | Oct 1, 2018 | Yes (Oct 1, 2019) | Transaction-count test removed in 2019. |
Ohio | ≥ $100,000 in gross sales or 200+ transactions | Previous or current calendar year | Aug 1, 2019 | Yes (Sep 1, 2019) |
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Oklahoma | ≥ $100,000 in taxable sales | Previous or current calendar year | Nov 1, 2019 | Yes (Apr 10, 2018 — earliest in US) |
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Oregon | N/A | — | — | — | No state sales tax. (Corporate Activity Tax applies to businesses with OR commercial activity.) |
Pennsylvania | > $100,000 in gross sales | Previous 12 months | Jul 1, 2019 | Yes (Apr 1, 2018) |
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Rhode Island | ≥ $100,000 in gross revenue or 200+ transactions | Previous calendar year | Jul 1, 2019 | Yes (Jul 1, 2019) |
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South Carolina | > $100,000 in gross revenue | Previous or current calendar year | Nov 1, 2018 | Yes (Apr 26, 2019) | No transaction-count test. |
South Dakota | > $100,000 in gross sales | Previous or current calendar year | Nov 1, 2018 | Yes (Mar 1, 2019) | The state behind Wayfair. Transaction-count test (200+) was repealed Jul 1, 2023. |
Tennessee | > $100,000 in retail sales | Previous 12-month period | Oct 1, 2019 | Yes (Oct 1, 2020) | Threshold lowered from $500K to $100K on Oct 1, 2020. |
Texas | > $500,000 in gross revenue from TX sales | Preceding 12 calendar months | Oct 1, 2019 | Yes (Oct 1, 2019) | Higher threshold. Remote sellers can elect a single 8% combined use tax rate instead of tracking local rates. |
Utah | > $100,000 in gross revenue or 200+ transactions | Previous or current calendar year | Jan 1, 2019 | Yes (Oct 1, 2019) |
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Vermont | > $100,000 in sales or 200+ transactions | Prior 12-month period | Jul 1, 2018 | Yes (Jun 1, 2019) |
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Virginia | > $100,000 in retail sales or 200+ transactions | Previous or current calendar year | Jul 1, 2019 | Yes (Jul 1, 2019) |
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Washington | ≥ $100,000 in gross retail sales | Current or previous calendar year | Oct 1, 2018 (threshold dropped Mar 14, 2019) | Yes (Jan 1, 2018 — earliest) | Transaction-count test removed in 2019. |
West Virginia | ≥ $100,000 in gross sales or 200+ transactions | Previous or current calendar year | Jan 1, 2019 | Yes (Jul 1, 2019) |
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Wisconsin | > $100,000 in gross sales | Previous or current calendar year | Oct 1, 2018 | Yes (Jan 1, 2020) | Transaction-count test (200+) was repealed Feb 20, 2021. |
Wyoming | > $100,000 in gross sales | Previous or current calendar year | Feb 1, 2019 | Yes (Jul 1, 2019) | Transaction-count test (200+) was repealed Jul 1, 2024. |
Physical nexus: activities that create nexus in nearly every state
Physical nexus is triggered by having a tangible connection to a state. Unlike economic nexus, there is no dollar threshold — even one qualifying activity can create nexus. The following are the most common physical-nexus triggers and apply in almost every sales-tax state (specific rules vary):
Offices, stores, warehouses, or other real property located in the state (owned or leased).
Employees working in the state — whether full-time, part-time, or remote. Even a single remote employee working from their home in a state typically creates nexus.
Independent contractors or sales reps who solicit business or perform services in the state on your behalf.
Inventory stored in the state — including inventory held in third-party fulfillment warehouses (e.g., Amazon FBA). This is one of the most commonly overlooked triggers for e-commerce sellers.
Tangible personal property you own or lease in the state (equipment, machinery, samples, display fixtures).
Delivering goods in company-owned vehicles into the state (regular deliveries, not occasional common-carrier shipments).
Attending trade shows or conventions — many states have a "days in state" exception (often 7–15 days per year) but exceeding that can create nexus.
Performing services in the state — installation, training, repair, consulting.
Affiliate nexus — having a related company with physical presence in the state that promotes your business.
Click-through nexus — paying in-state residents a commission to refer customers via links on their websites (applies in some states).
What this means for you
Remote employees are the single biggest physical-nexus surprise for growing companies. Every state where you have a W-2 employee (or in some cases a 1099 contractor working regularly) should be on your nexus watch list.
Amazon FBA sellers should assume nexus in every state where Amazon stores their inventory. Amazon provides an inventory report showing warehouse locations. Marketplace facilitator laws now cover the collection of sales tax on Amazon sales themselves, but inventory can still trigger registration and income/franchise tax obligations.
Once you have physical nexus, it usually "sticks" for some time after the activity ends (trailing nexus) — often 12 months. Close it out properly with the state.
A note on marketplace facilitators
Every state with sales tax now has a marketplace facilitator law. These laws require large online marketplaces (Amazon, eBay, Etsy, Walmart.com, etc.) to collect and remit sales tax on sales made by third-party sellers on their platforms. What this means for you:
If 100% of your sales in a state go through a marketplace that collects tax, you may not need to register — but rules vary, and some states still require you to register and file "zero" returns, or require registration if you also have physical nexus.
If you sell through both a marketplace AND your own website (e.g., Shopify store), you still need to count your direct-to-consumer sales against that state's economic nexus threshold. Some states include marketplace sales in the threshold calculation, and some don't — check the specific state.
Marketplace sales are usually included in economic nexus threshold calculations even though the marketplace is collecting the tax. This is a common source of confusion.
Quick next steps
Map your footprint. Make a list of every state where you (a) have employees, (b) store inventory, (c) own property, or (d) have significant sales.
Run the numbers. For each state, compare your trailing 12-month (or prior calendar year) sales and transactions against the threshold in the table above.
Register where you have nexus. Most states let you register online in 15–30 minutes. Some states offer a free amnesty or voluntary disclosure program if you're behind — worth a look before you register normally.
Set up a collection and filing process. Configure your e-commerce platform, ERP, or tax engine to collect the right rate. File on time — late filings almost always incur penalties and interest.
Re-check annually. Thresholds, rules, and effective dates change. Budget time each January to review your footprint.
Disclaimer
This document is a general reference guide intended to help you understand sales tax nexus at a high level. It is not tax or legal advice. Sales tax rules change frequently, vary based on your business type (goods vs. SaaS vs. services vs. digital goods), and often have state-specific exceptions not captured in a summary table. Before registering, deregistering, or relying on any information here, please consult a qualified sales tax professional or your accountant.
Last updated: April 17, 2026. Sources: state departments of revenue and publicly available statutory summaries current through Q1 2026.