Hello and welcome to the latest part of my small business accounting series. In this article I will focus on ways to pay sales tax online. But first, it's time to discuss whether or not you run the type of business that requires you to collect sales tax from your customers.

Does My Company Need To Collect Sales Tax?


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Chances are, if you’re in the business of selling physical products, including ecommerce and online shops, you’re going to have to deal with collecting and remitting sales tax for your business.


The sales tax process is pretty straightforward though it may seem intimidating at first. Sales Tax is a tax on products that is collected at the state level - and it's up to you as an owner or operator to collect sales tax and remit it to the appropriate states and jurisdictions. Check out the 6 steps to filing sales tax below:

Courtesy of TaxJar.com

I will go into detail regarding Item #1, as this right away is likely to confuse you.

Wondering where you owe sales tax? Click HERE to find out.

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Sales tax nexus, also known as "economic nexus", is a fancy way of saying that there’s a bunch of states or jurisdictions to whom you may owe sales tax, depending on where your customers are purchasing from and the volume of sales you're making.

In fact, you may have heard of the recent Wayfair vs. South Dakota sales tax case. South Dakota argued with Wayfair that customers buying from Wayfair and getting products delivered, ought to pay sales tax to the state on that. South Dakota fought and won - establishing a precedent for online sellers everywhere to register and collect sales tax in multiple states as necessary. Ecommerce sales tax collection is now a major fact of running an online store, and ecommerce sales tax software is a popular solution to the time-consuming problem of calculating sales tax for all 50 states!


Ecommerce Sales Tax Rules with TaxJar.com


If your business is registered in one of these green states below, then you know for sure you'll have some economic nexus rules to follow when filing sales tax (Map is accurate as of September 4 2019):

Courtesy of TaxJar.com

Keep in mind, the state your business is registered in will likely have to apply for sales tax anyway as the nexus laws only apply to non-home states, so check out my resource at the bottom of the article for registering for sales tax in every state in the USA.

And if your business is registered in a Green State above, check out my compilation of nexus rules by state that you'll have to follow for different states you may be selling in (Accurate as of September 4 2019):


Information compiled from TaxJar.com

Nationwide Sales Tax Compliance. Sounds Thrilling, Doesn’t it?


I am being sarcastic because it is not thrilling at all. Even as an accountant, I can say filing sales tax for my clients isn’t always easy and breezy, and there is a lot of research and legwork involved for each and every sales tax situation and jurisdiction there is. So if you’re not a serious lover of sales tax, there’s a chance you’d rather be sitting in a dental chair than dealing with any of this right now.

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 That is where TaxJar comes in. Designed to be one of the most “plug and play” softwares out there with tons of integrations into existing ecommerce brands like Shopify, Amazon and Woocommerce, TaxJar will let you file sales tax without any of the research and legwork. Sales tax for e commerce is such a complicated area, as you can probably tell from all the charts and graphs I'm throwing out here. If you’re already running or thinking of running an online store with any of these platforms, TaxJar is one of the obvious choices to make your tax compliance completely headache-free.

With TaxJar, not only will you be able to integrate at the click of a button, but you can even select to auto file as well - that's right, the folks at TaxJar will file your sales tax for you while you sit back and never miss a deadline (and there's usually multiple deadlines per year!)

This video does a good job explaining exactly how the process of connecting and filing with TaxJar works for sales tax on the internet.



Tax Jar really can be your sales tax on the internet go-to solution when you need to just get tax compliance done smoothly for your online stores.

The other issue of doing sales taxes on your own is time and efficiency. Like I said, even as an accountant it can take me hours to put together a sales tax return manually. There is no reason why you as a small business owner should be taking any more of your precious time and resources on something like this - you also needn’t pay an accountant for their time to the tune of hundreds of dollars per hour.

Check out TaxJar's pricing below to see what package might be most appropriate for your company.


Courtesy of Taxjar.com
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As you can see, TaxJar comes to just $17 per month (if you pay annually), if you’re doing under 1,000 sales per month. That comes to just $204 for the year, in order to forget about sales tax completely and just let TaxJar handle it for you at the expert level.

If you check out the monthly billing options, it will average out to a few additional dollars more per month ($19 per month base version), if you'd prefer to pay month by month.


So What Other Options are There Besides TaxJar?


If you're looking to file sales tax in a more hands-on way, or you just don't think you make enough sales to make using TaxJar worthwhile, it may be time to set up some sales tax tracking of your own. Quickbooks is a top small business accounting software that helps you do sales tax accounting and produce sales tax reports smoothly - stay tuned for my articles on why Quickbooks can save you so much headache when it comes to bookkeeping and taxes, so add "sales tax reports" to the list of reasons you're considering that purchase.

Another great sales tax resource could be the Streamlined Sales Tax Governing Board. If your state is one of the 20 states in the agreement, this may be the way to go. By registering with these folks, you will potentially be able to register for up to 20 state sales tax licenses and greatly streamline some of your sales tax compliance. Additionally, certain businesses with low enough sales volume actually qualify for FREE assistance from a Certified Service Provider with SSTGB, so be sure to check here whether you may qualify.


How to Register for Sales Tax Online


TaxJar can file all your sales tax seamlessly, but a human from your organization may still have to obtain state license. Remember, you'll definitely have to register to collect sales tax in your home state (if your products are subject to sales tax, that is), and potentially other states too, depending on your economic nexus. Below I link you directly to state departments of revenue, so you understand straight from the source.

If the thought of figuring this out on your own is again making your eyes pop, I'm going to have to recommend TaxJar again as the one to hold your hand! As their customer, they will provide you guidance as to whether you're on the right track, and for a fee of approx. $100 per state they will even obtain state permits for you. If you get started with TaxJar, be sure to inquire about this service.


Register for Sales Tax by State:


  • Alabama sales tax rates - Register for an Alabama sales tax license here.
  • Alaska sales tax rates - Generally 0% sales tax, however certain jurisdictions require registry.
  • Arizona sales tax rates - Register for an Arizona sales tax license here.
  • Arkansas sales tax rates - Register for an Arkansas sales tax license here.
  • California sales tax rates - Register for a California sales tax license here.
  • Colorado sales tax rates - Register for a Colorado sales tax license here.
  • Connecticut sales tax rates - Register for a Connecticut sales tax license here.
  • Delaware sales tax rates - Read the requirements about Delaware gross receipts.
  • Florida sales tax rates - Register for a Florida sales tax license here.
  • Georgia sales tax rates - Register for a Georgia sales tax license here.
  • Hawaii sales tax rates - Read the requirements about Hawaii General Excise Tax.
  • Idaho sales tax rates - Register for a Idaho sales tax license here.
  • Illinois sales tax rates - Register for a Illinois sales tax license here.
  • Indiana sales tax rates - Register for a Indiana sales tax license here.
  • Iowa sales tax rates - Register for a Iowa sales tax license here.
  • Kansas sales tax rates - Register for a Kansas sales tax license here.
  • Kentucky sales tax rates - Register for a Kentucky sales tax license here.
  • Louisiana sales tax rates - Register your Louisiana business here.
  • Maine sales tax rates - Register for a Maine sales tax license here.
  • Maryland sales tax rates - Register for a Maryland sales tax license here.
  • Massachusetts sales tax rates - Register for a Massachusetts sales tax license here.
  • Michigan sales tax rates - Register for a Michigan sales tax license here.
  • Minnesota sales tax rates - Sign up for Minnesota business tax services here.
  • Mississippi sales tax rates - Register for a Mississippi sales tax license here.
  • Missouri sales tax rates - Register for a Missouri sales tax license here.
  • Montana sales tax rates - Read about Montana sales tax requirements here.
  • Nebraska sales tax rates - Register for a Nebraska sales tax license here.
  • Nevada sales tax rates - Register for a Nevada sales tax license here.
  • New Hampshire sales tax rates - There is no New Hampshire sales tax requirement.
  • New Jersey sales tax rates - Register for a New Jersey sales tax license here. If you're an out of state seller, mail this form instead.
  • New Mexico sales tax rates - Register for a New Mexico sales tax license here.
  • New York sales tax rates - Register for a New York sales tax license here.
  • North Carolina sales tax rates - Register for a North Carolina sales tax license here.
  • North Dakota sales tax rates - Register for a North Dakota sales tax license here.
  • Ohio sales tax rates - Register for an Ohio sales tax license here.
  • Oklahoma sales tax rates - Register for a Oklahoma sales tax license here.
  • Oregon sales tax rates - There is no Oregon sales tax requirement.
  • Pennsylvania sales tax rates - Register for a Pennsylvania sales tax license here.
  • Rhode Island sales tax rates - Register for a Rhode Island sales tax license here.
  • South Carolina sales tax rates - Register for a South Carolina sales tax license here.
  • South Dakota sales tax rates - Register for a South Dakota sales tax license here.
  • Tennessee sales tax rates - Register for a Tennessee sales tax license here.
  • Texas sales tax rates - Register for a Texas sales tax license here.
  • Utah sales tax rates - Register for a Utah sales tax license here.
  • Vermont sales tax rates - Register for a Vermont sales tax license here.
  • Virginia sales tax rates - Register for a Virginia sales tax license here.
  • Washington sales tax rates - Register for a Washington sales tax license here.
  • Washington DC sales tax rates - Register for a Washington DC sales tax license here.
  • West Virginia sales tax rates - Register for a West Virginia sales tax license here.
  • Wisconsin sales tax rates - Register for a Wisconsin sales tax license here.
  • Wyoming sales tax rates - Register for a Wyoming sales tax license here.


Ecommerce Sales Tax Collection Made Easy Using TaxJar


The best weapon is good information, and I've attempted to pack this article full of sales tax filing ideas. Comment below if you have any questions about sales tax beyond what's covered. And be sure to join my mailing list if you'd like to stay in the loop for small business tax compliance tips year-round.

I hope you're on a good path to understanding a bit more about ecommerce sales tax rules. And don't forget to consult Quickbooks for your sales tax accounting needs along with your general small business accounting, when keeping track of the sales your company is making and preparing your company records for tax season.