Do You Need to Get a Sales Tax Permit in Nebraska?
Quick Answer: You need to get a sales tax permit in Nebraska if you meet economic, physical presence, affiliate, or trade show related nexus requirements as determined by the state. Read on for more detailed information.
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, 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 Nebraska, 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 Nebraska for more information about that process.
Common Ways to Have Sales Tax Nexus in Nebraska
1. Economic nexus in Nebraska
If you made $100,000 of sales or 200 or more separate transactions in the previous or current calendar year into Nebraska, then you are required to register for, collect, and pay sales tax to the state. If you meet this economic nexus threshold, it does not matter if you have a physical presence in Nebraska. Nexus has been created based on your volume of sales.
For more information, please see Nebraska Revised Statute 77-2701.13.(2).
If you need help determining which states you have crossed economic nexus thresholds, check out our Sales Tax Starter Kit service.
2. Physical presence nexus in Nebraska
The following creates physical presence nexus in Nebraska. If you have any of the following in Nebraska, you will need to get a sales tax permit:
- Maintaining, occupying, or using an office, place of distribution, sales or sample room or place, warehouse, storage place, or other place of business in the state;
- Having any representative, agent, salesperson, canvasser, facilitator, or solicitor selling, delivering, or taking orders for any property;
- Deriving rentals from a lease of property in the state;
- Soliciting retail sales of property from residents of Nebraska on a continuous, regular, or systematic basis by means of advertising which is broadcast into the state or installed onto an electronic device located in this state;
For more information, see Nebraska Revised Statute 77-2701.13.(1).
If you need help determining which states you have a physical presence in, check out our Sales Tax Starter Kit service.
Free State Audit Risk Guide
See which states pose the greatest risk to your business.
State-by-State Audit Risk Percentages
Uncommon Ways to Have Sales Tax Nexus in Nebraska
1. Affiliate Nexus in Nebraska
What exactly is affiliate nexus? Affiliate nexus can exist when a business has sufficient contact with a state through a separate business. If your out-of-state business has a relationship with an in-state business, then you may have affiliate nexus.
Please keep in mind that an “affiliated business” does not necessarily mean that it is a marketing “affiliate” in the typical sense of the word. Instead, “affiliate nexus” refers to the relationship between two businesses.
Affiliate nexus is created if your business has any of the following connections to a business within Nebraska:
- Being owned or controlled by the same interests that own or control any retailer engaged in business in the state; or
- Maintaining or having a franchisee or licensee operating under the retailer’s trade name in Nebraska if the franchisee or licensee is required to collect the tax.
For more information, see Nebraska Revised Statute 77-2701.13.(6) &(7)
2. Trade Shows
If you make sales at a trade show in Nebraska, you must obtain a sales tax permit and collect and remit sales tax unless the producer of the show agrees to remit tax on your behalf.
Even if you do not make sales at the trade show, your presence at a trade show could create nexus since a retailer is “engaged in business” in Nebraska if it temporarily maintains, occupies, or uses an office, sales or sample room, or other place of business in the state. Subsequently, an out-of-state business that participates as an exhibitor at a trade show in Nebraska may be subject to tax collection and registration requirements even if it does not make sales or take orders at the show.
For more information, see Nebraska Dept of Revenue Information Guide – Sales at Special Events.
Do You Need a Sales Tax Permit in Nebraska If You Only Sell on Marketplaces?
Yes. According to this statement from the Nebraska Department of Revenue, Notice for Remote Sellers and Marketplace Facilitators:
“Remote sellers exceeding the threshold who make sales through a MMP, also known as a marketplace facilitator, must file sales tax returns reporting all of their Nebraska sales, but are relieved of the duty to collect and remit the sales tax on sales facilitated by the MMP if the MMP has reported and remitted the tax to DOR.”
So, even when the marketplace collects and remits the sales tax due in Nebraska, you are still required to get a permit and file returns if you meet economic nexus requirements.
If you are an e-commerce seller who is unsure of where you need to get a sales tax permit, feel free to check out our Sales Tax Starter Kit service.
Disclaimer: Our attorney wanted you to know that no financial, tax, legal advice or opinion is given through this post. All information provided is general in nature and may not apply to your specific situation and is intended for informational and educational purposes only. Information is provided “as is” and without warranty.