The Idaho State Tax Commission has issued a statement in response to the Wayfair decision by the Supreme Court of the United States. Currently, they are taking the case under consideration, which overturns roughly 50 years of sales tax precedent. The Wayfair case removed the requirement that businesses have a physical presence within a state in order to be subject to a state’s taxing authority. This requirement allowed for remote, online retailers to make tax free sales into states at the disadvantage of local, brick and mortar businesses. Now that physical presence is not a requirement however, remote sellers are left wondering what the new standard will be.

While Idaho contemplates the future of Wayfair and its implications for the future of sales tax collection and remittance, the Commission did move forward with enacting one of the less extreme expansions of nexus in the meantime. Effective July 1, 2018, the Commission will being implementing the recently adopted law allowing for Click-Through Nexus. Click through nexus imposes sales tax collection requirements on retailers when (1) the out-of-state seller has an agreement with an Idaho retailer to refer potential buyers to the out-of-state seller for a commission and (2) the total sales to the Idaho buyers exceeded $10,000 in the previous year.

If you fall under the new click-through nexus standard, you will want to register immediately for proper compliance with Idaho sales tax law. More information on the procedures for registering your business with the state of Idaho can be found here. It is vital that business owners are aware that registering with the state does come with the risk of potential future audits. As a result, taxpayers should consult an experienced professional to ensure proper registration and collection and remittance policies going forward in their business.

Gerald “Jerry” Donnini II is a shareholder of the Law Offices of Moffa, Sutton, & Donnini, P.A. Mr. Donnini concentrates in the area of state and Federal tax matters, with a heavy emphasis on the tobacco, alcohol, motor fuel and related industries. He also handles a myriad of multi-state state and local tax issues. Mr. Donnini is a co-author for CCH’s Expert Treatise Library: State Sales and Use Tax and writes extensively on multi-state tax issues for SalesTaxSupport.com.  For more information please call us at 888-966-8216.

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