Sales Tax After Wayfair: What Every Online Seller Must Know

The Supreme Court's 2018 decision in South Dakota v. Wayfair, Inc. eliminated the physical presence requirement for sales tax. Today, selling enough goods or services into a state — even without an office, employee, or warehouse there — creates a legal obligation to collect and remit that state's sales tax.

Economic Nexus: What It Means

Every state with a sales tax now has an economic nexus law. Cross the threshold and you must register, collect, and file — regardless of where your business is located.

Most states: $100,000 in gross sales OR 200 separate transactions into the state in the prior or current calendar year
California, Texas, New York: $500,000 threshold
Kansas: No minimum — any economic activity creates nexus
Thresholds reset January 1 in most states

Marketplace Facilitator Laws

If you sell on Amazon, eBay, Etsy, or through Shopify Payments, the marketplace is legally required in most states to collect and remit sales tax on your behalf. Your marketplace sales still count toward your nexus thresholds. Sales through your own independent website remain your responsibility.

What Non-Compliance Actually Costs

Back sales tax on every transaction into that state since your threshold was crossed
Interest at 8–12% per year, compounding from the date tax was due
Penalties of 10–25% of the unpaid tax
Personal liability: in most states, business owners are personally responsible for uncollected sales tax — it does not disappear in bankruptcy

Voluntary Disclosure: The Right Path Forward

If you have uncollected sales tax exposure from prior periods, do not wait for the state to contact you. Most states offer a Voluntary Disclosure Agreement (VDA) program — come forward first and states typically limit the lookback period to 3–4 years and reduce or waive penalties entirely. SK Financial manages the VDA process on your behalf.

Getting Compliant

Nexus analysis — determine which states you have crossed the threshold in
Register for a sales tax permit in each nexus state ($150/state via SK Financial)
Configure your eCommerce platform or Avalara/TaxJar to collect the correct rate
File monthly ($100/mo) or quarterly ($200/qtr) returns in each nexus state through SK Financial