Sales and Use Taxes for E-Commerce Transactions

Most states impose sales and use taxes on retail sales of certain tangible personal property. Sellers with a physical presence in the state must report their taxable sales and remit the appropriate amount of sales tax. Sellers without a physical presence in the state are not responsible for collecting sales tax, although consumers who purchase goods from out-of-state sellers for consumption within their resident state are responsible for paying a use tax to that state. CPAs should remain aware of laws and regulations related to sales and use taxes, as well as the evolving landscape associated with sales and use taxes for e-commerce transactions. They should be familiar with the relevant court cases addressing sales and use taxes -- which establish a basis for current law and the potential for future changes -- and with related information about state and federal activities. CPAs can use Web-based resources to keep current on sales and use tax changes for e-commerce transactions.