Wisconsin Proposes Sales Tax Economic Nexus Rule

Wisconsin’s proposed sales tax economic nexus rule would be consistent with the U.S. Supreme Court’s Wayfair decision. The state would also enforce the rule by October 1, 2018.

The Department of Revenue requests public comment on the proposed rule by October 10, 2018.

Nexus Thresholds for Out-of-State Sellers

The proposed rule contains nexus thresholds for retailers that sell to Wisconsin customers but have no physical presence in Wisconsin.

Generally, remote retailers must register and collect Wisconsin sales or use tax if, in the previous or current year, their:

  • annual gross sales into Wisconsin exceed $100,000; or
  • annual number of separate sales transactions into Wisconsin is 200 or more.

Voluntary Collection

Remote sellers who are not required to collect Wisconsin tax could elect to collect use tax for their customers’ convenience. These sellers can apply to the department for a use tax registration certificate.

Retailers that hold a use tax registration certificate must:

  • collect the use tax from Wisconsin customers;
  • give receipts; and
  • report and pay the use tax.

Local Tax Collection

Retailers that have to register and collect Wisconsin sales or use tax must also collect and remit applicable local taxes.

Enforcement Date

Wisconsin will begin its enforcement of the rule on October 1, 2018.

Proposed Rule Sec. Tax 11.97, Wisconsin Department of Revenue, September 2018; Administrative Rule Open for Public Comment, Wisconsin Department of Revenue, September 10, 2018

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CCHTaxGroup

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