Do You Need to Get a Sales Tax Permit in Idaho?
Quick Answer: You need to get a sales tax permit in Idaho if you meet economic or physical presence nexus requirements. More detailed information is included below.
What is Sales Tax Nexus Anyway?
Your business owes sales tax in any state where it has “sales tax nexus”. In short, if you have sales tax nexus you need to collect and remit sales tax. If you don’t have sales tax nexus, you generally don’t need to get a permit.
Sales tax nexus is a legal term that means you have crossed a threshold and now have a sales tax collection responsibility in the state. Nexus can be created by having a physical presence, an economic presence, or by other factors. Nexus rules vary by state and retailers have specific nexus rules based on where they have people, property or inventory.
What Should You Do Once You Determine You Have Sales Tax Nexus?
Once you determine that you have sales tax nexus in Idaho, your next step is to register for a sales tax permit in the state. Check out our blog post on getting a sales tax permit in Idaho for more information about that process. If you are not interested in doing the work of getting the permit yourself, TaxValet can handle the permit registration for you with our Sales Tax Permit Registration Service.
Common Ways to Have Sales Tax Nexus in Idaho
1. Economic nexus in Idaho
If you made $100,000 of sales in the previous or current calendar year into Idaho, then you are required to register for, collect, and pay sales tax to the state. If you meet this threshold, it does not matter if you have a physical presence in Idaho. Nexus has been created based on your volume of sales. For more information, please see HB 259.
If you need help determining which states you have crossed economic nexus thresholds, check out our Sales Tax Starter Kit service.
2. Physical presence in Idaho
The following creates physical presence nexus in Idaho. If you have any of the following in Idaho, you will need to get a Sales tax permit:
- An office, warehouse, sales or sample room, or storage place.
- Renting or leasing property (other than real property) to a customer who uses the property in Idaho.
- Business that repairs, maintains or services tangible personal property in Idaho.
- A salesperson, agent, or representative who comes to Idaho to sell, deliver, install, or take orders. This could be at a trade show in Idaho. (It doesn’t matter whether the salesperson, agent, or representative is your employee, or whether they live in Idaho or another state.)
- Any retailer having a franchisee or licensee operating under its trade name, if the franchisee or licensee is required to collect sales tax.
For more information about physical nexus in Idaho, see Section 63-3611 of the House Bill No. 259.
If you need help determining which states you have a physical presence in, check out our Sales Tax Starter Kit service.
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Do You Need a Sales Tax Permit in Idaho If You Only Sell on Marketplaces?
If you are an online retailer who ONLY sells on approved marketplaces (such as Amazon, eBay, etc), sales tax will be remitted by the marketplace, however, the state still requires you to remit a sales tax return if your annual sales exceed $100,000 in Idaho, including marketplace sales. If your total sales in Idaho do not exceed $100,000 in a year, you are not required to get a sales tax permit.
For more information about marketplace only sellers see Idaho State Tax Commission.
If you are an e-commerce seller who is unsure of where you need to get a sales tax permit, check out our Sales Tax Starter Kit service. In fact, if at any point you are stuck and want a team of experts to handle all of this for you, don’t hesitate to contact us.