Understanding Nexus and Sales Tax Obligations in Various States of the United States
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Understanding Nexus and Sales Tax Obligations in Various States of the United States

Generally, sales tax nexus refers to the threshold that compels a seller to collect and remit sales tax on sales made within a state in the United States. Many U.S. states have specific nexus requirements that determine when a seller is obligated to collect sales tax.

Nexus can be created in the following ways: 

  • Physical Nexus
  • Economic Nexus 

 First, let’s understand the physical nexus requirement in the next section.