In the time since the 2018 Wayfair decision, dozens of states across the U.S. have passed economic nexus legislation. These laws compel out-of-state retailers with no physical presence to remit sales tax once they meet the state’s minimum economic nexus requirements.
A year and a half later, the complexity of the new legislation is creating headaches for businesses all over the country.
Even worse is the undeniable fact that the added complexity is opening up companies to the additional risk of Qui Tam lawsuits from whistleblowers.
What is a Qui Tam Lawsuit?
A Qui Tam lawsuit is brought forward under the False Claims Act (FCA), which alleges a business committed fraudulent behavior that impacted governmental programs. These suits are filed on behalf of the government by an individual (the whistleblower) in exchange for a portion of the recovery (generally 15 to 25 percent).