On April 28, 2019, Governor Brian Kemp signed into law House Bill 182, which lowers the economic nexus threshold for Georgia sales tax filings required of sellers located outside the state of Georgia making sales for delivery to purchasers in Georgia.
The Georgia Department of Revenue issued a new Policy Bulletin that provides guidance on remote sellers’ Georgia sales and use tax obligations recently modified under House Bill 182. It also provides guidance on notice and reporting requirements that have been repealed under the bill.
In essence, Georgia has lowered the ‘economic nexus threshold’ for sellers outside the state. Previously, remote sellers only had to file sales and use tax returns in Georgia if they had annual sales in Georgia of at least $250,000 or 200 or more retail transactions in the state. With the new law, that threshold is lowered to $100,000, meaning that more businesses are going to have sales tax filing requirements and owe sales tax in Georgia!
There are two important points for remote sellers doing business in Georgia to know:
- The change in economic nexus thresholds will take effect January 1, 2020. On that date, a remote seller must collect and remit Georgia state and local sales and use tax on their taxable Georgia sales if they have earned more than $100,000 in Georgia sales of tangible personal property or property delivered electronically, or had 200 sales transactions in the current or previous calendar year.
- The notification option for remote sellers has been eliminated. Previously, a remote seller that met one of the thresholds could choose not to collect and remit sales tax, but rather comply with certain notice requirements. This option was repealed effective April 28, 2019. As of July 1, 2019, these remote sellers were required to start collecting and remitting sales and use tax on their taxable Georgia sales.
S.J. Gorowitz Accounting & Tax Services, P.C. specializes in the specific financial needs of expanding and emerging companies, including those that are doing business in multiple states. We understand the increasing complexity of sales tax filing requirements that vary tremendously by state.
Contact us at any time for more information and assistance with your tax obligations.