Nexus represents a physical connection between an out-of-state company and a particular taxing jurisdiction which makes the out-of-state company responsible for collecting and remitting sales tax on their transactions. Having a physical office or an employee based in a particular state is a clear-cut example of nexus. However, there are more subtle activities that could also trigger nexus that could represent risk to your business:
- Many states have concluded that VoIP providers utilize and benefit from existing telecommunications infrastructure which as a result creates nexus.
- Sales reps traveling into another state where they are not based to solicit sales.
- Employees attending trade shows.
- An affiliate or agent relationship that supports selling or servicing activities.
Enhanced Tax Solutions helps you identify the relevant nexus creating activities and determine where you have an obligation to collect and remit sales tax. Where we determine you have nexus, we will recommend simple, proactive steps based upon your risk quotient to remedy any potential exposure.
