New York State Announces Response to Wayfair Ruling

On January 15, 2019 the New York State Department of Taxation and Finance (“DOTF”) issued Notice N-19-1 outlining the DOTF’s response to the United States Supreme Court’s ruling in South Dakota v. Wayfair (138 S.Ct. 2080 [2018]) which eliminated the prohibition on a state imposing a sales tax collection responsibility on businesses that have no physical presence in that state.

As a result of the Wayfair decision certain existing provisions in the New York State Tax Law that define a sales tax vendor immediately became effective. Businesses that fall within this definition, and make taxable sales in New York State, are required to collect and remit New York State and local sales tax. Specifically, a business that had no physical presence in New York State but has both made more than $300,000 in sales of tangible personal property delivered in the state and conducted more than 100 sales of tangible personal property delivered in the state in the immediately preceding four sales tax quarters is required to register as a sales tax vendor, and collect and timely remit the applicable state and local sales tax.

The sales tax quarters in New York are: March 1 through May 31, June 1 through August 31, September 1 through November 30, and December 1 through February 28/29.

If you are a business that meets the above thresholds or have any questions, you should contact the Citrin Cooperman SALT team or your Citrin Cooperman advisor to potentially avoid penalties and ensure compliance with the ever changing sales tax environment.