Following the decision in South Dakota v. Wayfair, Inc., U.S. Supreme Court, Dkt. No. 17-494, June 21, 2018, the Kentucky Department of Revenue (DOR) issued a release on the state’s recently enacted sales tax nexus economic thresholds. The Wayfair decision held that physical presence in a state is not required to establish sales tax nexus, overruling Quill Corp. v. North Dakota, United States Supreme Court, 504 U.S. 298, 112 S.Ct. 1904 (1992).

The DOR points out that the thresholds enacted in recent KY legislation, are the same as those at issue in Wayfair and require no physical presence. The Kentucky law requires remote retailers to collect Kentucky sales and use tax if, in the previous or current calendar year:

  • their gross receipts from Kentucky sales exceeded $100,000; or
  • they had at least 200 separate in-state sales transactions of property.

The effective date in the bill for these changes is July 1, 2018.

It is expected that all other states that impose a sales tax will follow suit however each state may enact different effective dates for their law changes and will likely have differing thresholds for applicability.

Please contact us immediately if you have questions or concerns.