E-commerce sales tax mapping

E-commerce Sales Tax Alert: Key Updates for US Businesses in 2026 Dear US Business Owner / LLC Founder, The world of e-commerce sales tax is constantly evolving, and 2026 brings important changes you need to be aware of. Staying compliant is crucial to avoid penalties and ensure smooth operations. Here's a quick rundown of the essential updates and what they mean for your business: Economic Nexus Continues to Evolve Economic nexus remains the primary trigger for sales tax obligations. While common thresholds are $100,000 in sales or 200 transactions, some states are refining their rules. Notably, states like Illinois have removed transaction thresholds for 2026, moving to a revenue-only model. This means even if you have few transactions but high revenue, you could establish nexus. Always monitor your sales volume in each state. Marketplace Facilitator Laws: Still Count Towards Your Nexus! Marketplaces like Amazon collect sales tax on your behalf in nearly all states. However, a critical point often overlooked is that these marketplace sales still count towards your business's economic nexus thresholds. If your total sales (direct + marketplace) exceed a state's threshold, you'll have nexus and an obligation to collect tax on your direct sales. Digital Goods & Services: Expanding Taxability in 2026 If you sell digital products or services (streaming, subscriptions, SaaS), be aware that several states are expanding their taxability rules in 2026. For example, Maine now taxes digital audiovisual and audio services. Review the taxability of your digital offerings in every state where you have nexus. Your Action Plan for Compliance: 1. Monitor Nexus: Keep a close eye on your sales volume in all states, including marketplace sales, to identify where you're approaching or exceeding economic nexus thresholds. 2. Understand Product Taxability: Verify how your specific products and digital services are taxed in each relevant state. 3. Automate: Consider using sales tax software to streamline calculations, collections, and filings. 4. Stay Informed: Sales tax laws are dynamic. Regularly check state Department of Revenue websites for the latest updates. Staying proactive is your best defense against sales tax complexities. If you have questions, consulting a tax professional is always recommended.