California Targeting Remote Sellers

California has contacted more than 2,500 out-of-state retailers to notify them that they may owe sales tax due to the presence of products in California warehouses.  A remote seller owning products in a California warehouse creates a physical presence in California and therefore sales tax nexus.  The most common example is holding inventory in an Amazon warehouse.  If contacted by the State of California the remote seller will be required to remit sales tax on all sales into California from the time this nexus was created.  Any seller who believe they are in this situation should contact Eide Bailly’s State and Local Tax Team to discuss options to minimize the tax, penalties and interest. Once the state contacts the retailer the options to mitigate the exposure are limited. 

 

California Tax Update

Do you do business in the state of California, or are you considering expanding into the state? Join our State and Local Tax team for a webinar on December 7 and learn the ins and outs of California tax filing. This session will discuss registration and forms, various taxes, starting and closing a business, and more! Learn more and register here.