Wisconsin Might Enact Economic Nexus Law for Sales Tax

Wisconsin might enact an economic nexus law requiring remote sellers to collect sales and use tax. The law would include thresholds consistent with the Department of Revenue’s economic nexus rule that became effective October 1, 2018.

Nexus Thresholds for Out-of-State Sellers

The rule requires remote retailers to register and collect Wisconsin 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.

“Year” means the retailer’s tax year for federal income tax purposes.

Remote sellers that do not meet these thresholds do not have to register to collect Wisconsin sales or use tax. The thresholds are compatible with the U.S. Supreme Court’s Wayfair decision.

The bill that would enact the economic nexus thresholds is available on the Wisconsin Legislature’s website at https://docs.legis.wisconsin.gov/2017/proposals/sb883.

The proposed sales thresholds are law in many states.

S.B. 883, as passed by the Wisconsin Senate and Assembly on December 4, 2018

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CCHTaxGroup

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