Missouri: the final sales tax state to adopt economic nexus standards

It took a while, but as of January 1, the Show Me State became the final general sales tax state to require remote sellers and marketplace facilitators meeting economic nexus standards to collect and remit sales or use tax for sales to Missouri customers.

In the wake of the Wayfair 2018 decision by the U.S. Supreme Court overturning the longstanding physical presence test, by 2022 all general sales tax states but Missouri decided to use economic activity thresholds to determine which sellers and marketplaces must collect and remit sales or use tax in their states.

Missouri’s Particulars for Remote Sellers

Thresholds: $100,000 in sales of taxable tangible personal property sold to Missouri customers and shipped into the state annually. This includes sales through a marketplace facilitator.

Measurement Period: Each calendar quarter determine if your taxable sales into Missouri exceeded $100,000 in the preceding 12-month period. When exceeded, you are required to collect and remit tax to Missouri no later than three months following the close of the quarter.

Marketplace Facilitators: The registration requirements, forms, and particulars regarding marketplace facilitators, including the availability of a Timely Discount, are more complex.  The Missouri Department of Revenue has Remote Seller and Marketplace Facilitator FAQs to answer questions.

Registration: You can register online through the My Tax Missouri portal.

TaxCloud

The Bad News: The adopted standards are not ideal because the states have employed a complex array of rules or factors to determine when nexus is met. The different factors by state include which sales count (gross, retail, or taxable only), whether marketplace sales are included, the value of sales and/or number of transactions that trigger nexus (there are six variations), the measurement period (there are six variations), and when remote sellers must register (there are seven variations). The mix and match combinations the states have individually adopted are confusing at best.

The Good News: If you are a TaxCloud customer, we automatically track when you meet the economic nexus thresholds and standards in each state and begin collecting and remitting sales or use tax as required in each state. If you are not a TaxCloud customer, sign up at TaxCloud.com to keep up to date and compliant in the complex and constantly evolving world of sales and use tax.

TaxCloud is among those actively advocating to the states that they simplify matters by adopting uniform standards across the states that are easy to understand.