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US State Economic Nexus Sales Thresholds Reference

Since the 2018 South Dakota v. Wayfair decision, a state can require a seller with no physical presence to collect sales tax once sales into the state pass a set threshold. This table lets you screen where your plant or distribution business may have crossed that line.

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State	Sales threshold (USD, prior or current 12 months)	Transaction count test	Note
Alabama	250,000	None	Higher than the common 100,000 level
Arizona	100,000	None	Transaction privilege tax regime
Arkansas	100,000	None
California	500,000	None	Sales into the state, state level threshold
Colorado	100,000	None	Local home rule cities add their own rules
Connecticut	100,000	200 transactions	Both tests must be met
Florida	100,000	None
Georgia	100,000	Verify current rule	Check Department of Revenue guidance
Illinois	100,000	None	Retailers' Occupation Tax
Indiana	100,000	None
Kansas	100,000	None
Kentucky	100,000	None
Louisiana	100,000	None	Parish level collection adds complexity
Massachusetts	100,000	None
Michigan	100,000	None
Minnesota	100,000	Verify current rule	Check Department of Revenue guidance
Mississippi	250,000	None	Higher than the common 100,000 level
Missouri	100,000	None
Nevada	100,000	None
New Jersey	100,000	200 transactions	Either test triggers nexus
New York	500,000	More than 100 transactions	Both tests must be met
North Carolina	100,000	None
Ohio	100,000	None
Oklahoma	100,000	None
Pennsylvania	100,000	None
South Carolina	100,000	None
Tennessee	100,000	None
Texas	500,000	None	Total revenue from Texas sales in the preceding 12 calendar months
Utah	100,000	None
Washington	100,000	None	Retail sales tax plus B and O tax nexus rules differ
Wisconsin	100,000	None
Delaware, Montana, New Hampshire, Oregon	No state sales tax	Not applicable	Montana, New Hampshire and Oregon have no general state sales tax; check local and other taxes

Thresholds change by legislation and are measured differently by state (gross sales, taxable sales, or retail sales). Treat this as a screening table and confirm against the state revenue department before registering or deregistering.

Ship-to state sales report from your ERP

Optional: we can review how your ERP reports sales and exemptions by ship-to state and suggest a nexus monitoring query.

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How to use the table

Search by state name, then compare the threshold with your trailing 12 month sales shipped to customers in that state. Pull the figures from your ERP sales ledger by ship-to state, not bill-to state, because nexus follows where goods are delivered. If you are close to a threshold, register early or confirm with the state. Remember that exempt sales, such as sales for resale or manufacturing exemptions, may or may not count toward the threshold depending on the state's wording.

What the threshold actually measures

States differ on the base. Some count gross sales, some count taxable retail sales only, and some exclude marketplace facilitator sales. Several states also look at a transaction count. The practical consequence is that two sellers with identical revenue can have nexus in one state and not another.

Gross sales: all sales delivered into the state
Retail sales: only sales that would be taxable at retail
Marketplace sales: usually excluded when the marketplace collects the tax
Look-back period: prior calendar year, or the trailing 12 months, depending on the state

Common mistakes

The most common error is treating physical nexus and economic nexus as alternatives. A plant, a warehouse, a field technician or inventory held at a third party logistics provider creates physical nexus regardless of sales. The second error is registering after the threshold date: most states require collection from the date you cross the threshold or the first day of the following month, so late discovery creates back tax exposure.

Frequently Asked Questions

Is the Texas threshold 500,000 dollars?

Yes. Texas requires remote sellers to register and collect once total revenue from sales delivered into Texas exceeded 500,000 dollars in the preceding 12 calendar months. Confirm the current rule and the treatment of exempt sales with the Texas Comptroller before relying on it.

Does economic nexus apply to services?

Sales tax nexus generally concerns taxable sales of tangible goods and the services a state taxes. If you sell nontaxable services only, the threshold may never create a collection duty. Check whether your products or digital items are taxable in each state.

Do I need to collect from the day I cross the threshold?

Rules vary. Many states require collection starting with the transaction that crosses the threshold or the first day of the next month. Some give a short grace period. Look at each state's effective date language before setting your ERP tax rule start date.

Does this replace income tax nexus analysis?

No. Sales tax economic nexus is separate from income and franchise tax nexus. Public Law 86-272 protects some sales of tangible goods from state income tax, but not from sales tax collection duties.

If your ERP cannot report sales by ship-to state and exemption status, Netray can help build that report so nexus monitoring stops being a quarterly spreadsheet exercise.

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