As we know, the June 2018 U.S. Supreme Court decision in South Dakota v. Wayfair, Inc., et al, allows for an economic nexus threshold for all types of taxes. Many states already had an economic nexus threshold for income taxes. Many states have adopted the South Dakota threshold for nexus. This standard generally starts use tax obligations when a vendor has over $100,000 of sales in the prior calendar year or the current year to date or 200 or more transactions.
Now, one state – Hawaii, has adopted that same threshold for its state income tax effective for tax years beginning after 12/31/19. [SB 495 (Act 221, 7/2/19)] Hawaii’s sales tax nexus threshold based on the South Dakota law upheld by the Court started 7/1/18.
Also, the Texas Comptroller has proposed the same via a proposed regulatory change for its franchise tax. The Texas sales tax Wayfair threshold though is over $500,000 of sales and it doesn’t matter how many transactions there are (there is only a dollar sales threshold).
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