Texas Expected to Adopt Economic Nexus Rules in Early 2019

Friday, July 20th, 2018

Remote sellers getting retail item ready to ship.

The Texas Comptroller recently announced that it will adopt new rules in early 2019 to address the Supreme Court decision in South Dakota v. Wayfair. Under Wayfair, states can require certain out-of-state sellers without a physical presence in the state (remote sellers) to collect sales tax. Rules relating to remote sellers are generally referred to as "economic nexus" rules.

The Comptroller announced that Texas will not apply economic nexus rules retroactively, and it will create safe harbor provisions in order to exclude certain small sellers from collection requirements. The safe harbor provisions addressed in Wayfair exclude remote sellers from collection requirements unless they deliver more than $100,000 in goods or services into South Dakota, or make 200 or more separate transactions into South Dakota. The publication does not address whether Texas will adopt the same safe harbor provisions as South Dakota.

The Comptroller has also recommended that the state legislature (1) amend the definitions of "seller" and "retailer" to include online marketplaces used by third-party sellers, (2) enact legislation that provides adequate liability protection for online marketplaces, and (3) amend other miscellaneous laws.


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

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