Sales Tax Nexus in 2026
Sales tax in 2026 is a moving target. Marketplace facilitator laws have closed most of the obvious gaps, but edge cases — Shopify direct-to-consumer sales, multi-state operations, economic nexus thresholds, and the distinction between sales tax and income tax obligations — remain active sources of compliance risk for omnichannel sellers.
What marketplace facilitator laws mean for you
Marketplace facilitator laws, now enacted in all 45 US states with a sales tax plus Washington DC, require the marketplace (Amazon, Etsy, TikTok Shop, eBay) to collect and remit sales tax on your behalf for sales made through their platform. This means that for sales made through these platforms, your sales tax collection and remittance obligation is largely discharged by the platform — you generally do not need to register, collect, or remit sales tax in states where you sell exclusively through facilitator platforms.
The critical qualifier is "through their platform." Sales you make directly — through your own website (Shopify, WooCommerce, Squarespace) — are not covered by marketplace facilitator laws. You are the merchant of record on direct sales, which means sales tax collection, remittance, and registration obligations fall entirely to you.
The Shopify nexus gap
If you sell on Shopify and ship to customers in a state where you have established economic nexus, you must collect and remit sales tax on those sales. Economic nexus thresholds in most states are $100,000 in annual revenue or 200 transactions into that state, whichever is reached first. Some states have lower thresholds — Pennsylvania, for example, has a $100,000 threshold with no transaction count alternative.
For a seller doing $500,000 in Shopify revenue spread across 40+ states, it is entirely possible to have nexus in 10–15 states and not be registered in any of them. The liability accrues from the date nexus was established, not from the date of registration. Back tax exposure — including penalties and interest — can be substantial for sellers who have been ignoring this for multiple years.
Income tax obligations are separate from sales tax
Marketplace facilitator laws cover sales tax only. They do nothing to eliminate your income tax, franchise tax, or gross receipts tax obligations in states where you have established physical or economic nexus. Physical nexus is created by having employees, contractors, inventory (including FBA inventory), or business property in a state. Economic nexus for income tax purposes uses different thresholds from sales tax in many states.
FBA creates physical nexus in every state where Amazon stores your inventory. Amazon stores inventory in fulfilment centres across 20+ states. This means most FBA sellers have income tax filing obligations in 20+ states that they may not be aware of. The compliance cost of multi-state income tax filing is real — typically $150–$300 per state filing using a CPA — but it is substantially less than the liability and penalties for non-compliance.
Tools for ongoing compliance
For sales tax compliance on Shopify, integrate a service like TaxJar, Avalara, or Anrok. These tools calculate the correct sales tax rate for each transaction at the address level (which matters because rates vary by city and county, not just state), generate filing-ready reports by state, and in some cases handle the filing and remittance automatically. The cost is typically $19–$99/month depending on order volume, which is a negligible fraction of the exposure it eliminates.
For income tax nexus review, a CPA with e-commerce specialisation should audit your multi-state exposure annually. Provide them with a list of every state where Amazon stores your FBA inventory (downloadable from Seller Central) and your Shopify revenue by state. They can determine your nexus footprint and either register you in the relevant states proactively or guide a voluntary disclosure agreement if you have existing unaddressed liability.
The voluntary disclosure option
If you have unpaid sales or income tax liability in multiple states, voluntary disclosure agreements (VDAs) offer a path to resolving historical exposure with reduced or waived penalties and a limited lookback period (typically 3–4 years rather than unlimited). VDAs must be initiated before a state contacts you — once you receive a nexus questionnaire or audit notice from a state, the VDA window closes.
Most states participate in the Multistate Tax Commission's National Nexus Programme, which allows a single application to initiate VDAs in multiple states simultaneously. A CPA or tax attorney experienced in multi-state e-commerce compliance can manage this process. For sellers with 3+ years of unaddressed multi-state exposure, this is typically the most cost-effective resolution path available.
This article is for informational purposes only and does not constitute tax, legal, or accounting advice. Consult a licensed CPA or tax attorney before making any compliance decisions.