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Managing eCommerce sales tax is one of the most confusing and overlooked aspects of running an online store. With rules that vary by state and constantly changing regulations, it's easy to make costly errors. Here are the top 3 mistakes online sellers often make—and how to avoid them. 1. Ignoring Economic Nexus Laws Many sellers assume they only need to collect sales tax in their home state. However, economic nexus laws now apply in most U.S. states, meaning if your sales exceed a certain threshold (often $100,000 or 200 transactions), you may need to collect and remit sales tax there—even without a physical presence. 2. Incorrect or Incomplete Tax Collection Settings Relying solely on default tax settings in platforms like Shopify or Amazon can lead to incorrect tax collection. Rates can vary by ZIP code, and not all products are taxed equally. It’s important to review and update your tax collection rules regularly. 3. Missing Filing Deadlines Even if you collected the correct am...

  Managing sales tax can be one of the more complex aspects of running an online store. With constantly changing laws and regulations across different states and countries, it’s crucial for eCommerce businesses to stay informed and organized. Here are the top 5 tips for managing sales tax in your online store, ensuring you stay compliant while focusing on growing your business. 1. Understand Your Sales Tax Nexus The first step in managing eCommerce sales tax is understanding your “nexus.” Nexus is the connection between your business and a state or jurisdiction that requires you to collect sales tax. Nexus can be created in various ways, such as having a physical presence (like a warehouse or office) in a state, or even through economic activity, such as making a certain number of sales or reaching a revenue threshold. 2. Automate Sales Tax Calculations Manual sales tax calculations can lead to errors, especially when your business expands and operates in multiple states. Using au...