Which States Require Sales Tax Based on Click-Through Nexus?

by Mark Faggiano April 5, 2018

Affiliate nexus states

Last updated May 17, 2021

In a recent post we covered click-through nexus and what it means for small business owners everywhere. In short, it’s another in a series of tax headaches that eCommerce sellers have to deal with as states try to collect revenue. Rather than taxing businesses due to physical nexus in a state, states are collecting money from businesses who have affiliates in other states.

But not every state has required businesses to pay taxes on click-through nexus. As with sales tax, there’s no federal rule regarding click-through nexus. Judicial rulings in various states mean that some states are allowed to declare that sellers are on the hook for sales tax if the have click-through nexus, while others are not. Illinois is the latest state to fail to institute click-through nexus (link opens in PDF).  In fact, the Illinois Supreme Court turned down the provision because it was “unfair to Internet retailers.”

We thought it would be helpful for you and other small business owners to have a list of states that currently tax sellers with click-thru nexus. Hopefully this list helps you run your business more smoothly moving forward.

States That Have Enacted Click-Thru Nexus Provisions

Below are the states that have started their own program. Along with the state, you’ll find information on what the threshold is for the affiliate program/marketing program. Until you hit this, you shouldn’t have to worry about complying with the sales tax on click-through in the state unless you otherwise have nexus in the state. For example, if the threshold is $10,000, you must hit $10,000 worth of sales in that state for the nexus to affect you.

Of course, these laws change constantly, so please consult your accountant should you have any questions.

Also included is whether the provision is rebuttable (if you can prove you don’t need to pay, you’re good) or irrebuttable (it’s impossible to turn over the state’s law no matter how strong the evidence is) presumption.

Arkansas

Threshold: More than $10,000 during the preceding 12 months.

Arkansas has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Arkansas.

California

Threshold: More than $10,000 and more than $1 million in annual in-state sales.

California has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in California.

Connecticut

Threshold: More than $2,000 during the preceding four quarterly periods.

Connecticut has an irrebuttable presumption.

Click here for more about who should register for a sales tax permit in Connecticut.

Georgia

Threshold: More than $50,000 in the preceding 12 months.

Georgia has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Georgia.

Idaho

Threshold: More than $10,000 in the preceding 12 months.

Idaho has rebuttable presumption.

Click here for more about who should register for a sales tax permit in Idaho.

Kansas

(Kansas will no longer have click-through nexus after June 30, 2021)

Threshold: More than $10,000 during the preceding 12 months.

Kansas has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Kansas.

Louisiana

(Goes into affect April 1, 2016)

Threshold: More than $50,000 during the preceding twelve months.

Louisiana has rebuttable presumption.

Click here for more about who should register for a sales tax permit in Louisiana.

Maine

Threshold: More than $10,000 during the preceding year.

Maine has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Maine.

Michigan

Threshold: More than $10,000 during the immediately preceding 12 months.

Michigan has rebuttable presumption.

Click here for more about who should register for a sales tax permit in Michigan.

Minnesota

Threshold: More than $10,000 in the 12-month period ending on the last day of the most recent calendar quarter before the calendar quarter.

Minnesota has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Minnesota.

Missouri

Threshold: More than $10,000 in the preceding 12 months.

Missouri has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Missouri.

Nevada

Threshold: More than $10,000 in the preceding quarterly four periods.

Nevada has rebuttable presumption.

Click here for more about who should register for a sales tax permit in Nevada.

New Jersey

Threshold: More than $10,000 in the prior four quarterly periods.

New Jersey has rebuttable presumption.

Click here for more about who should register for a sales tax permit in New Jersey.

New York

Threshold: More than $10,000.

New York has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in New York.

North Carolina

Threshold: More than $10,000 during the preceding four quarterly periods.

North Carolina has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in North Carolina.

Ohio

Threshold: More than $10,000 during the preceding calendar year.

Ohio has rebuttable presumption.

Click here for more about who should register for a sales tax permit in Ohio.

Pennsylvania

Threshold: There is no threshold specified, so assume you owe sales tax if you have click-thru nexus.

Pennsylvania has no presumption on the books.

Click here for more about who should register for a sales tax permit in Pennsylvania.

Rhode Island

Threshold: More than $5,000 during the four preceding quarterly periods.

Rhode Island has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Rhode Island.

Tennessee

Threshold: More than $10,000 during the preceding 12 months.

Tennessee has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Tennessee.

Vermont

(Begins December 1, 2015)

Threshold: More than $10,000 in the preceding tax year.

Vermont has a rebuttable presumption.

Click here for more about who should register for a sales tax permit in Vermont.

Washington

Threshold: More than $10,000 in the preceding tax year.

Washington has rebuttable presumption.

Click here for more about who should register for a sales tax permit in Washington.

As you can see, the laws are different for every state and require you to keep up with your records. On top of that, some states don’t even give you the opportunity to try and prove you don’t have nexus in that state and therefore don’t owe sales tax.

Think it’s unfair? Still confused on how it works? Comment below to voice your opinion!


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