US Sales Tax & Nexus
A practical guide to US sales tax for international sellers. Understand when you have tax obligations, how to register, and how to stay compliant when selling to US customers.
Sales Tax vs Income Tax
US sales tax is separate from income tax. Sales tax is collected from customers and remitted to states. Income tax is on your profits. This guide covers sales tax only. For income tax, see our IRS guide.
Contents
What is US Sales Tax?
Unlike most countries with a national VAT, the United States has no federal sales tax. Instead, 45 states (plus DC) impose their own sales taxes. Each state sets its own rules, rates, and exemptions.
Key Differences from VAT
- State-level, not national
- Rates vary: 0% to 10%+ depending on state/locality
- Collected at point of sale (not at each stage like VAT)
- No input tax credit mechanism
- Some states have local taxes on top of state tax
Understanding Nexus
"Nexus" is the legal term for a sufficient connection to a state that creates a sales tax obligation. Without nexus in a state, you have no obligation to collect or remit sales tax there.
Types of Nexus
Physical Nexus
Having physical presence in a state: office, warehouse, employees, inventory stored at a fulfillment center (including Amazon FBA).
Economic Nexus
Meeting sales thresholds in a state (typically $100,000 in sales or 200 transactions). This can apply even without physical presence.
South Dakota v. Wayfair (2018): This Supreme Court decision allowed states to impose economic nexus on out-of-state sellers. Since then, most states have enacted economic nexus laws that can apply to foreign sellers.
Economic Nexus Thresholds by State
Most states use a $100,000 sales OR 200 transactions threshold. However, thresholds vary and some states have dropped the transaction count.
| State | Sales Threshold | Transaction Threshold | Tax Rate |
|---|---|---|---|
| California | $500,000 | None | 7.25% + local |
| Texas | $500,000 | None | 6.25% + local |
| New York | $500,000 | 100 | 4% + local |
| Florida | $100,000 | None | 6% + local |
| Pennsylvania | $100,000 | None | 6% |
| Washington | $100,000 | None | 6.5% + local |
Note: These are select examples. Thresholds can change. Always verify current requirements with official state sources.
Rules for Foreign Sellers
As a Turkish seller, you may have US sales tax obligations if you meet nexus thresholds, even without any physical presence in the US.
When Foreign Sellers Have Nexus
- Amazon FBA: If you use Fulfillment by Amazon, your inventory is stored in US warehouses. This creates physical nexus in states where your inventory is located.
- High Sales Volume: Exceeding economic nexus thresholds in any state triggers collection obligations there.
- US Warehouse/3PL: Using any third-party logistics provider in the US creates physical nexus in that state.
Good News: If you sell directly from Turkey (dropshipping, digital products, or international shipping) and don't meet economic nexus thresholds, you likely have no sales tax obligations.
Marketplace Facilitator Laws
Most states have enacted "marketplace facilitator" laws that shift sales tax collection responsibility to the marketplace rather than individual sellers.
What This Means for You
If you sell through these marketplaces, they handle sales tax collection and remittance for you:
- Amazon
- eBay
- Etsy
- Walmart Marketplace
- Shopify (with their tax services)
Important: Marketplace facilitator laws cover sales made ON the marketplace. If you also sell through your own website, you are responsible for those sales tax obligations separately.
Registration Process
If you determine you have nexus in a state, you must register for a sales tax permit before collecting tax.
Steps to Register
- Get an EIN: You need a US Employer Identification Number. Foreign businesses can apply by mail using Form SS-4.
- Register in each nexus state: Each state has its own registration portal. Some participate in the Streamlined Sales Tax (SST) program for easier multi-state registration.
- Configure your software: Set up your e-commerce platform to calculate and collect the correct tax rates.
- File returns: Filing frequency varies by state (monthly, quarterly, or annually) based on your sales volume.
Software Solutions
Managing sales tax across multiple states manually is extremely difficult. These platforms automate calculation, collection, and filing:
TaxJar
Popular for small-medium businesses. Integrates with major platforms.
From $19/month
Avalara
Enterprise-grade solution. Comprehensive compliance tools.
Custom pricing
Quaderno
Good for digital products and SaaS. International focus.
From $49/month
Stripe Tax
Built into Stripe. Simple for Stripe users.
0.5% per transaction
States with No Sales Tax
Five states have no state-level sales tax. Sales to customers in these states generally do not require sales tax collection:
*Alaska has no state sales tax but allows local municipalities to impose their own sales taxes.
Frequently Asked Questions
Do I need to collect sales tax if I sell digital products?
It depends on the state. Some states tax digital products (software, e-books, streaming), while others exempt them. You still need nexus in a state before any collection obligation applies.
What happens if I don't collect sales tax when required?
States can assess back taxes, penalties, and interest. They may also hold you personally liable. Some states offer voluntary disclosure programs with reduced penalties for businesses that come forward proactively.
I use Amazon FBA. Do I have nexus in all 50 states?
Not necessarily in all 50, but likely in many. Amazon stores your inventory across their network of fulfillment centers. You have physical nexus in each state where your inventory is stored. Amazon does provide inventory placement reports.
Do I need a US business entity to register for sales tax?
No, you don't need a US LLC or corporation. Foreign businesses can register for sales tax permits in most states. However, you will need an EIN, and the registration process may require additional documentation for foreign entities.
Related Guides
Cite This Entry
EchoLegal, “US Sales Tax & Nexus Guide,” EchoLegal Legal Encyclopedia, v1.0 (last updated Feb 17, 2026), https://echo-legal.com/en/abd-satis-vergisi-rehberi.
US Sales Tax & Nexus Guide, EchoLegal Legal Encyclopedia (last updated Feb 17, 2026), https://echo-legal.com/en/abd-satis-vergisi-rehberi.
ecl-gde-00015Disclaimer
This guide is for informational purposes only and does not constitute tax or legal advice. Sales tax laws vary by state and change frequently. Consult with a qualified tax professional for guidance specific to your situation.