US Sales Tax Compliance Checklist for E-Commerce Sellers 2026

This checklist covers every action a US-based e-commerce seller must take to maintain sales tax compliance when selling to customers across all 50 states, DC, and Puerto Rico. It does not address shipping logistics, store design, or marketing. For state-level rates and threshold details, see the State Sales Tax Index.

Local tax rates, exact product taxability classifications, and filing calendar specifics vary too widely to enumerate in a checklist. For those, use certified tax software or verify directly with the relevant state Department of Revenue or SSTGB.org.

Step 1: Determine Where You Have Nexus

Nexus is the legal connection to a state that obligates you to collect and remit sales tax there. Two types apply to e-commerce sellers.

1a. Physical Nexus

You have physical nexus in a state from your first sale into it if you have any of the following there:

Office, storefront, or other place of business
Warehouse, fulfilment centre, or inventory storage — including Amazon FBA facilities (see Amazon FBA & Physical Nexus)
Employees, contractors, or sales representatives
Third-party agents acting on your behalf

Physical nexus bypasses all economic thresholds. Obligation begins from dollar one.

1b. Economic Nexus

Economic nexus is triggered by sales volume alone. Once you cross a state’s threshold, you must register promptly — typically before the next transaction, at the start of the following month, or by a state-specific date.

Once you exceed a threshold, the obligation generally continues even if sales later drop — until you formally close the registration.

Nexus Threshold Patterns — as of June 2026

Pattern	States	Threshold
Common rule	Most states + DC + Puerto Rico	$100,000 in sales or 200 transactions in current or previous calendar year
Sales-only (transaction threshold eliminated)	Alaska (eff. Jan 1, 2025), Utah (eff. Jul 1, 2025), Illinois (eff. Jan 1, 2026)	$100,000 in sales only
High revenue threshold	California	$500,000 gross sales of tangible personal property
High revenue threshold	Texas	$500,000 gross revenue
High revenue threshold + transaction count	New York	$500,000 gross receipts and 100 transactions (previous four sales tax quarters)
Mid-level revenue threshold	Alabama	$250,000 retail sales (marketplace-facilitated sales often excluded from seller’s threshold)
Mid-level revenue threshold	Mississippi	$250,000 in sales
Dual condition (AND)	Connecticut	$100,000 and 200 transactions in the 12-month period ending September 30
No state sales tax	Alaska*, Delaware, Montana, New Hampshire, Oregon	No state-level obligation (*Alaska has local jurisdiction taxes via ARSSTC)

What counts toward the threshold varies by state — some use gross sales, some use taxable sales only, some include marketplace-facilitated sales (where the platform collected on your behalf), some exclude them. Use software with per-state nexus monitoring or check each state’s Department of Revenue.

1c. Ongoing Nexus Monitoring

Review nexus status monthly or quarterly — sales growth can push you over a threshold at any time
Use tax software with automated nexus alerts (see Step 4)
Track sales separately per state, not just total national revenue
Account for marketplace-facilitated sales per each state’s inclusion/exclusion rules

Step 2: Register for Sales Tax Permits

You must hold a valid sales tax permit in every state where you have nexus before collecting tax there.

2a. Streamlined Sales Tax (SST) Registration — Start Here for Multi-State Sellers

The SST programme offers a single registration that covers all 23 full member states simultaneously.

SST Full Member States (23): Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, Nevada, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Rhode Island, South Dakota, Utah, Vermont, Washington, West Virginia, Wisconsin, Wyoming.

Tennessee is an associate member with simplified rules.

Register via sstregister.org — free, covers all member states in one application
Consider engaging a Certified Service Provider (CSP) — CSPs are SST-approved vendors (Avalara, TaxJar, TaxCloud, and others) that handle calculation, filing, and remittance in SST states as part of their service, often at reduced or zero cost to the seller for SST-state filings
SST registration does not cover non-member states — register separately for those

2b. Individual State Registration — Non-SST States

Major non-SST states requiring separate registration: California, New York, Texas, Florida, Illinois, Pennsylvania, Arizona, Maryland, Massachusetts, Virginia, and others.

Register with each state’s Department of Revenue directly via their online portal
You will need: your EIN (Federal Employer Identification Number), business legal name, address, business structure, and estimated annual sales into the state
Some states issue a permit immediately online; others take days to weeks
Keep permit numbers — required on returns and sometimes on invoices

2c. Local Jurisdiction Registration

In most states, state-level registration covers local (county/city) taxes too — you file one return and it allocates local taxes.

Exceptions where local registration may be required separately:

Colorado Home Rule jurisdictions (~70+ cities with independent sales tax, e.g., Denver, Boulder) — register and file directly with each city
Louisiana — some parishes require separate parish-level permits
Alaska (ARSSTC) — no state tax, but local jurisdictions with taxes require separate registration via the Alaska Remote Seller Sales Tax Commission
Identify whether you sell to customers in Colorado Home Rule cities or Louisiana parishes and register accordingly
Use software that handles local filing, or verify with each jurisdiction directly

2d. Puerto Rico

Puerto Rico’s IVU (Impuesto sobre Ventas y Uso) applies at 10.5% state + 1% municipal
Threshold: $100,000 or 200 transactions (seller’s accounting/fiscal year)
Register with Puerto Rico’s Departamento de Hacienda (hacienda.pr.gov)

Step 3: Platform-Specific Compliance

Your obligations vary significantly depending on how and where you sell. See the US Sales Tax Overview for a full platform breakdown.

3a. Amazon FBA and Amazon Marketplace

Amazon acts as the marketplace facilitator in virtually all applicable US states and DC — it calculates, collects, remits, and reports sales tax on your marketplace orders. You do not collect or remit for those transactions.
Critical: Amazon FBA warehouses create physical nexus for you in every state where Amazon stores your inventory — bypassing economic thresholds. See Amazon FBA & Physical Nexus.
Pull your Inventory Event Detail Report or Inventory Ledger Report from Seller Central quarterly to identify which states hold your stock
Register in all FBA nexus states even if your marketplace sales there are below economic thresholds — physical nexus has no minimum
Provide accurate product taxability information to Amazon where requested (product tax codes)
Even though Amazon collects for marketplace sales, those sales may still count toward your economic nexus threshold in some states for your other channels (own store, direct sales)

3b. Etsy

Etsy acts as marketplace facilitator in most states — it handles collection and remittance for Etsy sales
Etsy sales may count toward your nexus threshold for your other channels — monitor aggregate multi-channel sales per state
If you also sell through your own website or direct channels, those sales require separate compliance where you have nexus

3c. eBay

eBay acts as marketplace facilitator in most states
Same monitoring obligations apply as Etsy — track aggregate cross-channel sales per state

3d. Shopify (Your Own Store)

You are the merchant of record — fully responsible for collection and remittance where nexus exists
Shopify Tax calculates rates at checkout but does not register you, file returns, or remit tax
Configure Shopify Tax settings for each nexus state after registering
Shopify’s data silo problem: Shopify Tax only sees your Shopify revenue, not Amazon or other channel sales — nexus monitoring must be done across all channels. See Shopify Sales Tax Limitations.
Use a third-party filing service (Avalara, TaxJar, TaxCloud) to pull Shopify data and file returns

3e. WooCommerce and Custom Stores

You are the merchant of record — fully responsible for all tax compliance
Install a tax calculation plugin (Avalara for WooCommerce, TaxJar, or TaxCloud) — WooCommerce has no built-in rate database
Configure product taxability per state for digital goods, clothing, food, or any category with variable taxability
Ensure your checkout collects destination-state tax (destination sourcing applies to interstate sales in all states)

3f. Multi-Channel Sellers

Aggregate sales data across all channels per state monthly — no single platform sees your full nexus picture
Use tax software that integrates with all your sales channels to track combined nexus thresholds
Set threshold alerts at 80% of each state’s limit, not 100% — registration takes time

Step 4: Tax Software Setup

Tax software is essential for multi-state compliance. It handles rate lookups, nexus monitoring, exemption certificate management, and return filing. It does not replace registration — you must register in nexus states separately (or use software that offers registration services).

Software	Best For	Key Strengths
Avalara (AvaTax)	High-volume, multi-state, complex needs	Comprehensive calculation + exemption management + automated filing; strong Amazon/Shopify integrations; CSP for SST states; enterprise scalability
TaxJar	E-commerce SMBs	Easy AutoFile returns; good platform integrations (Amazon, Shopify, WooCommerce); clear nexus dashboard
TaxCloud	SMBs wanting affordable unlimited filings	Good integrations; unlimited filings on higher plans; SST CSP; straightforward for standard physical goods
Stripe Tax	Stripe-native sellers	Simple activation; handles calculation + remittance in supported states; cost-effective at 0.5% per taxed transaction — but tracks nexus on Stripe revenue only. See Stripe Tax for SaaS & Digital Goods.
Anrok	SaaS and digital product sellers	Purpose-built for recurring billing and digital goods taxability; multi-processor nexus tracking; strong Stripe Billing / Chargebee integrations
Vertex	Enterprise with ERP systems	Deep ERP integrations (SAP, Oracle); enterprise-grade calculation and compliance; high cost
Quaderno	Digital creators, international sellers	Multi-channel (Shopify + Stripe + PayPal); EU VAT + US sales tax combined; automatic invoicing
Sovos / Kintsugi / Numeral	Specialist and emerging needs	Varying strengths; evaluate based on specific channel mix and volume

Checklist:

Select software based on: number of nexus states, sales channels, product types (physical vs digital), volume, and budget
Connect all sales channels to the software — not just your primary platform
Map all products to correct tax codes (product taxability varies by state and product type)
Enable nexus threshold monitoring and alerts
Configure exemption certificate collection and storage
Test calculation on orders from multiple states before going live
Review software-generated returns before submission — software reduces errors but does not eliminate the need for oversight

Step 5: Collection at Checkout

Confirm your platform applies destination-state tax on interstate sales — the buyer’s shipping address determines the applicable rate for all remote sales
Map each product to its correct taxability classification per state. Common variables:
- Clothing: exempt under $110 per item in New York; taxable in most other states
- Groceries/food: exempt or reduced in many states; taxable in others
- Digital goods and SaaS: taxable in approximately half of states, not taxable in others — mapping required (see Stripe Tax for SaaS & Digital Goods)
- Prescription drugs: generally exempt; over-the-counter varies
- Software downloads vs SaaS: treated differently in some states
For B2B sales, collect a valid resale or exemption certificate before zero-rating the transaction. Acceptable formats:
- State-issued resale certificate (state-specific format)
- Streamlined Sales Tax Exemption Certificate (accepted in SST member states)
- Verify the certificate is complete, current, and applies to the goods purchased
Store all exemption certificates — minimum 3–7 years depending on state
Do not collect sales tax in states where you are not registered — but begin collection immediately upon registration

Step 6: Filing, Remittance & Ongoing Compliance

6a. Filing Frequency

States assign filing frequency based on your tax liability within that state:

Liability Level (approximate)	Typical Frequency
High (generally $1,000–$2,000+/month in state tax liability)	Monthly
Mid (few hundred dollars/month in state tax liability)	Quarterly
Low (minimal state tax liability)	Annual

The state assigns your initial frequency at registration and may reassign it annually. Verify your frequency in your state account.

6b. Filing Checklist

File returns on schedule — due dates are commonly around the 20th of the month following the reporting period, but vary by state. Confirm each state’s specific deadline.
File zero returns even in periods where you had no taxable sales in a registered state — most states require it; failure to file triggers penalties
Remit the exact amount collected (do not net against other costs)
Use software to generate, e-file, and initiate payment where possible — reduces manual error
Confirm payment posted to the state account — do not assume payment succeeded because software initiated it
For SST states using a CSP: the CSP handles filing and remittance on your behalf; verify data submitted to them is accurate

6c. Record Retention

Retain sales tax returns, supporting records, exemption certificates, and transaction data for a minimum of 3–7 years (varies by state; some require longer)
Store records in a format that can be produced in an audit (CSV exports, software archives, or accounting system records)

6d. Audit Preparedness

Maintain clean transaction records: date, customer address, product description, taxable/exempt status, rate applied, tax collected
Reconcile tax collected in your platform with tax remitted to states quarterly
Respond to state nexus questionnaires promptly — they are a precursor to audit
If you discover back-period uncollected tax, investigate Voluntary Disclosure Agreements (VDAs) — most states offer them, they cap look-back periods (typically 3–4 years), and waive or reduce penalties if you come forward before the state contacts you

6e. Annual Review

Each January, review all states for updated thresholds or rule changes
Review your nexus position — new states may have crossed thresholds in the prior year
Update software and platform tax configurations for any rate or rule changes
Review filing frequency assignments — states may reassign based on prior year liability

Verification & Professional Advice

This checklist reflects US sales tax rules as of June 2026. Tax laws, thresholds, product taxability rules, and local rates change frequently. This is a factual guide, not legal or tax advice.

For your specific situation:

Use certified tax software for accurate rate lookups and filing
Verify nexus thresholds and product taxability with each state’s Department of Revenue
Reference SSTGB.org for SST state rules and certified provider lists
Consult a qualified sales tax CPA or specialist for multi-state setup, back-period exposure, or audit response

Non-compliance risks include back taxes, penalties, interest, audit costs, and potential business disruption.