Sales Tax For Out-Of-State Businesses

The word "nexus" is merely Latin for connection. But it stands for one of the most complicated aspects of tax law in Texas or any other state:

When does a state or local government have a sufficiently close connection to impose sales taxes on a company that operates from another state?

At Brown, PC, we know how vexing this question can be for you. Since leaving the Tax Division of the U.S. Department of Justice in 1992, Lawrence Brown has built a legal team that provides skilled counsel on all aspects of tax law, including compliance with remote taxation requirements in Texas. We are proud of our record of success in helping clients resolve these issues.

Does Your Business Have Tax Nexus In Texas?

Getting skilled legal guidance on sales tax issues is especially important now, as standards for what is considered tax nexus in a state are evolving in the internet age.

Back in 1992, the U.S. Supreme Court held that the Commerce Clause of the Constitution prohibits states from requiring a seller to collect sales taxes unless the seller has a physical presence in the state. The case was called Quill v. North Dakota.

Nominally, the Quill ruling still stands in the Age of Amazon. There is considerable uncertainty today, however, about what type of physical presence might trigger an obligation by a retailer to collect Texas sales tax. The presence of an office, warehouse, distribution area or other contact point could potentially be considered a tax nexus, as could having employees or even independent contractors.

Adding to the complexity, Texas is among the states that are increasingly looking for ways to tax not only retailers, but also third-party sellers and online platforms such as Uber.

In short, the complex compliance landscape concerning Texas sales tax collection requirements is challenging for out-of-state businesses. It is best faced with the type of accessible yet highly skilled assistance we offer.

Sophisticated Guidance On Sales Tax Compliance

Using our up-to-date knowledge, we can take a deep dive into your business to gather the facts needed to advise you as to whether you have nexus that would create a state tax obligation.

Our lawyers can also advise on how to handle a situation where a company has nexus to Texas and has not been filing state returns or paying state taxes.

Call today to arrange a confidential consultation with an experienced tax attorney. Or, if you prefer, complete our brief online form.

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