Sales Tax Calculator

Businesses should collect sales tax only if they have nexus in a state. Sales tax nexus could be:

• A physical presence (office, employee, storage or warehouse, inventory) in that state.
• Marketing or sales affiliates that refer customers to your business.
• Web cookies or click-through ads used on in-state websites.
• A large volume or number of sales to in-state customers, a.k.a. economic nexus. (See next question!)

Each state has its own rules about nexus and when you’re liable for sales tax, so it’s important to check with local policies. Once you have a nexus, you should register for sales tax there and start collecting it on sales to customers within that state.

Maybe, this depends on how much you’re selling and where.

These days there are many places that tax online sellers, and the US is no different. More states are added to the list every year. In these states, you must charge sales tax for online transactions only if your annual sales exceed the economic nexus threshold. See question above!

Once you have economic nexus in the state, you’re legally required to register for sales tax.

You might not need to charge sales tax if a buyer has a tax exemption certificate. You also might not need to charge sales tax if you’re selling on or through an online marketplace that is covered by marketplace facilitator tax laws in that state.

Learn more about how to comply with sales tax.

If you’ve determined you’re liable for sales tax and are now wondering how to get a seller’s permit, check out our sales tax registration guides. These guides explain – step by step – how to register in different states around the US. You receive a seller’s permit or sales tax number once your registration process is complete!

Sales tax rates vary across the US for a number of reasons. Sales tax rates are set at the state level, with the possibility of regional or city-wide taxes added on top. This second layer of sales tax is typically referred to as “local taxes” and the percentages are very small in comparison.

Another reason rates might vary is whether the state follows destination-based or origin-based sales tax rules. The first follows the tax rate based on the destination of your sale, i.e. where your customer is located, while the second uses the tax rate of the origin of the sale, i.e. where your business or the item is located.

Yet another reason tax rates might differ is because of the product you’re selling. Authorities often set different rates for certain products in order to encourage or discourage their sales. For example, educational products, books, and newspapers often have low or no tax added – while cigarettes and alcohol are taxed at rates higher than average.

If you’re curious about a specific location, calculate the sales tax in your area by entering a location and zip code into our Sales Tax Calculator.

When you first register for sales tax, the state’s tax authorities assign you a filing frequency. The frequencies are either monthly, quarterly, or annually – and sometimes a combination of these. This usually depends on the income or sales volume of your business, with high-grossing businesses filing more often and small businesses filing once per year.

Due dates for each filing period are set by the local authorities. You should always double check in the states where you’re registered, to see the tax deadlines for the year ahead. Then you’re sure to have enough time to prepare your sales tax return with accurate information, then also file your sales tax return on time.

You still have to pay the tax that’s due on your sales, even if you didn’t collect it from your customers at the point of sale. That means paying out of pocket. In addition, there could potentially be penalties or fines for failing to collect the tax properly.

With a tax automation tool like Quaderno, sales tax is collected for you automatically on every sale. You never have to worry about calculating tax correctly or keeping the right records. We’ll track your tax liabilities and give you clear reports for filing season. See what it’s like with a free trial!