What is happening?
The Supreme Court released its decision on the landmark sales tax case, South Dakota v. Wayfair.
What did the Supreme Court decide?
The Supreme Court ruled in favor of South Dakota on June 21, 2018. Prior to this ruling, an online seller only had to collect sales tax from buyers in states where the online seller had a physical presence. This physical presence requirement was known as “sales tax nexus”. By ruling in favor of South Dakota, The Supreme Court has decided physical presence is not required.
A brief history
Back in 2016, South Dakota passed a law requiring any online seller – whether they have nexus in the state or not – to collect South Dakota sales tax if they either made more than $100,000 in gross sales in the state in a calendar year, or made over 200 individual sales in the state each year. They followed this action up by using Wayfair, Newegg and other eCommerce retailers who currently did not collect South Dakota sales tax.
How does this affect my online shopping?
States are no longer bound by the concept of sales tax nexus. Instead, any state is allowed to require that an online seller who makes a sale into their state collect sales tax.
Which states are required to pay sales tax with Motorcyclegear.com?
As required by state law, orders shipping to Arizona, California, Colorado, Florida, Georgia, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, Nevada, North Carolina, Ohio, Oklahoma, Pennsylvania, Tennessee, Texas, Utah, Virginia, Washington, and Wisconsin are subject to applicable sales tax. Orders shipping to any other US state will not be charged sales tax. Consumers are still required to comply with any Use Tax obligations within from their state.
- Massachusetts Residents
Clothing designed primarily to protect from injury, including helmets, are taxable even if it’s priced at $175 or below. - Minnesota Residents
In the state of Minnesota, any accessories, the majority of protective equipment, sports, and recreational articles, and clothing made of fur are considered to be taxable. - New Jersey Residents
In the state of New Jersey, any sort of fur clothing, clothing accessories or equipment, sports equipment or recreational equipment, or protective equipment are considered to be taxable. The protective equipment is only deemed to be exempt when it was purchased for the purpose of the daily work of the user and is worn as part of a regular work uniform or regular work clothing. - Colorado Residents
Effective July 1, 2022, Colorado imposes a retail delivery fee on all deliveries by motor vehicle to a location in Colorado with at least one item of tangible personal property subject to state sales or use tax. For more information about this you can go here.
