SMART BUSINESS ON-LINE
By: SBN Staff | 1:22am EST March 1, 2017
The rise and proliferation of online commerce has increased the number and value of transactions with out-of-state retailers and in-state customers. A recent court decision has cleared the way for states to enforce sales and use tax reporting requirements and enforce tax collection laws on those transactions, which has put a heavier burden on businesses to comply.
“Because states are now more aggressively pursuing collection laws, companies that conduct interstate business need to be prepared to collect and pay the sales tax to the states,” says Jeff Stonerock, tax director at Clarus Partners.
Smart Business spoke with Stonerock about these laws, what they mean for businesses and how to comply.
What regulations exist for reporting sales and use tax obligations?
In 2010, Colorado passed a law requiring out-of-state sellers to either collect tax based on the amount of sales into the state of Colorado, or if the seller does not collect sales tax, to begin changing their invoices to customers to notify them that sales tax is due on their purchase even though the seller is not collecting the sales tax.
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