With multiple state lawsuits, competing federal legislation, many state bills, and several rulings and regulations, the physical presence rule remains an important and contentious issue.  In this article for the TEI magazine, Mark Yopp takes a practical approach for practitioners to deal with the ever-evolving landscape.

Read the full article.

Reprinted with permission. Originally published

Today, the Chairman of the House Judiciary Committee, Rep. Goodlatte from Virginia, released the long-anticipated discussion draft of the Online Sales Simplification Act of 2016. Highlights of the bill include:

  • The bill implements the Chairman’s much-discussed ‘hybrid-origin’ approach.
  • The bill removes the Quill physical presence requirements for sales tax collection obligations under certain circumstances.
  • States may impose sales tax on remote sales IF the state is the origin state and it participates in a statutory clearinghouse AND the tax uses the origin state base and the destination state rate for participating states (the origin state rate is used if the destination state does not participate in the clearinghouse).
  • A remote seller will only have to remit the tax to its origin state for all remote sales.
  • A destination state may only have one statewide rate for remote sales.
  • Only the origin state may audit a seller for remote sales.
  • States that do not participate in the clearinghouse have significant restrictions on the ability to extract the tax from the remote seller.

Below is a more in-depth discussion of the intricacies of the bill.


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