Understanding Economic Nexus Post-Wayfair
Following the landmark Supreme Court decision in South Dakota v. Wayfair, remote SaaS companies must collect and remit state sales tax once their sales volume or transaction count exceeds state economic nexus thresholds (typically $100,000 in annual revenue or 200 separate transactions).
SaaS Taxability Variations Across US States
State tax treatment of SaaS varies dramatically. States like New York, Texas, and Pennsylvania tax SaaS as tangible personal property or information services, whereas California and Illinois generally exempt cloud-delivered SaaS.
Managing State Tax Rates in Bizohlala Invoicing
Bizohlala allows US businesses to apply customizable state and municipal sales tax rates to invoices based on client destination addresses.
How Bizohlala Solves This Automatically
Bizohlala supports customizable state and local tax rate rules on client invoices.
Try Bizohlala Free Now →Frequently Asked Questions (FAQ)
Q: Does selling SaaS across state lines automatically require sales tax registration?
A: Only once your business exceeds a specific state's economic nexus threshold (e.g. $100K in sales) or establishes physical nexus.