Ecommerce Sales Tax Nexus: What Every US Online Seller Must Know in 2025

In June 2018, the US Supreme Court's decision in South Dakota v. Wayfair changed everything for online sellers. For the first time, states could require remote sellers to collect and remit sales tax even without a physical presence in the state. If you are selling online to US customers and you have not reviewed your sales tax obligations since 2018, you probably have an unaddressed compliance gap.

What Is Economic Nexus?

Before Wayfair, sales tax nexus (the obligation to collect tax in a state) required physical presence — an office, a warehouse, employees. After Wayfair, states can create nexus based on economic activity alone — selling a certain volume of goods or reaching a revenue threshold in the state. Most states now have economic nexus thresholds of $100,000 in sales or 200 transactions per year. Cross either threshold in a state and you have an obligation to collect and remit that state's sales tax.

Which States Have Economic Nexus?

As of 2025, 45 states plus Washington DC have sales tax and have enacted economic nexus laws. The five states with no sales tax are Oregon, Montana, New Hampshire, Delaware, and Alaska (though Alaska allows local jurisdictions to have sales taxes). The threshold varies by state — most use $100,000/200 transactions, but some differ.

How Amazon and Shopify Handle This

If you sell through Amazon, Amazon collects and remits marketplace facilitator sales tax on your behalf in most states. You do not need to register or file in states where Amazon acts as the facilitator. This covers the majority of FBA sellers' obligations. For Shopify, the situation depends on whether you use Shopify Payments and which states you have nexus in — Shopify does not automatically collect or remit on your behalf the way Amazon does.

What You Need to Do If You Have Nexus

If you have crossed a threshold in a state: 1) Register for a sales tax permit in that state (done through the state revenue department website). 2) Configure your selling platform to collect the correct rate. 3) File periodic sales tax returns (monthly, quarterly, or annually depending on volume). Tools like TaxJar or Avalara automate this for multi-state sellers.

Frequently Asked Questions