The New Jersey Division of Taxation has updated its “Frequently Asked Questions” guidance pertaining to changes for determining nexus for sales and use tax purposes for remote sellers based outside the state. In response to the U.S. Supreme Court case of South Dakota v. Wayfair, New Jersey enacted P.L. 2018, c.132, which imposes sales tax collection and remittance requirements on remote sellers with sales that exceed the new nexus threshold. The new threshold is either: (1) the remote seller’s gross revenue from sales of tangible personal property, specified digital products or services delivered into New Jersey during the current or prior calendar year exceeds $100,000; or (2) the remote sellers sold tangible personal property, specified digital products, or services delivered into New Jersey in 200 or more separate transactions during the current or prior calendar year.
The Division’s guidance provides additional clarity on the following key points:
- The nexus changes took effect beginning on November 1, 2018 and are not applied retroactively to prior periods.
- In computing the $100,000 sales threshold for nexus, all sales delivered into the state are included—this includes nontaxable retail sales as well.