When Do You Need a Sales Tax Permit

You need a sales tax permit in any state where you sell taxable goods or services and have nexus. Nexus is a connection to the state strong enough that it can make you collect its tax. You get it through a physical presence, such as an office, inventory, staff or a booth at an event, or by passing the state's economic threshold for sales into the state.

A sales tax permit (also called a seller's permit or sales tax license) is your registration with the state tax agency. Once you hold one, you must collect tax on taxable sales and file returns.

What creates nexus?

Thresholds and rules change. Check each state's own page before you rely on a number.

Do you have a physical presence?

Physical presence is the oldest test. Texas says you are engaged in business there if you have a temporary or permanent location in the state, an employee or representative who sells, delivers or takes orders there, or people performing services there for you (Texas Comptroller permit FAQ). Texas also requires a separate permit for each place of business (Tex. Tax Code 151.201).

Most states use a similar list. If you have a location or people in a state that has a sales tax, assume you need a permit there and check that state's rules. Our sales tax registration pages cover each state's agency and process.

Selling at events and trade shows

A booth at a fair, festival or trade show is a physical presence for the days you are there. In Texas, a temporary location counts (Texas Comptroller permit FAQ). California offers a temporary seller's permit for sales of a temporary nature, valid for up to 90 days (CDTFA Publication 107).

Before the event, ask the organizer whether vendors must show a permit, and apply early enough for it to arrive.

Have you passed a state's economic threshold?

Since June 21, 2018, a state can require a seller with no physical presence to collect its tax. In South Dakota v. Wayfair, Inc., the Supreme Court overruled the physical presence rule and upheld a South Dakota law covering sellers with more than $100,000 of sales or 200 transactions into the state each year (South Dakota v. Wayfair).

Each state sets its own threshold, and the numbers differ. Three examples, as of October 2026:

• Texas: total Texas revenue of $500,000 or more in the preceding twelve calendar months. You must get a permit and start collecting no later than the first day of the fourth month after you pass it (Texas Comptroller, Remote Sellers).
• California: combined sales of tangible goods for delivery into California, by you and related persons, over $500,000 in the preceding or current calendar year (CDTFA).
• Florida: taxable remote sales into Florida over $100,000 in the previous calendar year (Fla. Stat. 212.0596).

Notice the differences: Texas counts all Texas revenue, taxable or not, while Florida counts only taxable remote sales. See the full list in our economic nexus thresholds guide.

What if you sell through a marketplace?

Where a state has a marketplace rule, the marketplace, not you, collects the tax on the sales it processes. A marketplace facilitator (or marketplace provider) is a platform that lists other sellers' goods and processes the payment.

Texas makes a marketplace provider collect and remit tax on sales it processes for marketplace sellers (Tex. Tax Code 151.0242). A remote seller who sells only through a provider that has certified it will collect is not required to hold a Texas permit, but must keep records of those sales for at least four years (Texas Comptroller). California has a similar rule for facilitators (Regulation 1684.5).

If you also sell through your own website, or you store inventory in a state, the marketplace rule may not cover you.

Which states have no general sales tax?

Five states have no general statewide sales tax. Each still has rules to know.

• Alaska: no state sales tax, but many cities and boroughs have one. Remote sellers register with the Alaska Remote Seller Sales Tax Commission (ARSSTC).
• Delaware: no state or local sales tax, but a gross receipts tax on sellers of goods and services (Delaware Division of Revenue).
• Montana: no general sales tax (Montana Department of Revenue).
• New Hampshire: no general sales tax on goods (New Hampshire DRA).
• Oregon: no general sales or use tax (Oregon Department of Revenue).

A business based in one of these states still needs a permit in any other state where it has nexus.

What happens if you get it wrong?

Selling without collecting. The tax is often owed by the seller whether or not you charged it. California imposes its sales tax on retailers (Rev. & Tax. Code 6051). If you skipped it, the tax can come out of your own pocket.

Selling without a permit. In Texas, doing business as a retailer without a required permit is a Class C misdemeanor for a first offense, rising for repeat offenses (Tex. Tax Code 151.708). Florida can charge a $100 registration fee to a business that should have registered and did not (Fla. Stat. 212.18).

Collecting without a permit. Money you collect as tax is not yours. In Texas, anyone who collects a tax, or money represented as tax, holds it in trust for the state and is liable for the full amount (Tex. Tax Code 111.016). Register, then remit it.

What to do next

1. List every state where you have a location, staff, inventory or event sales.
2. Total your sales into each other state and compare them with the economic nexus thresholds.
3. Register in each state where you have nexus, using the registration checklist. Start with your home state, such as Texas or California.
4. If you buy inventory to resell, get resale certificates too. See seller's permit vs resale certificate.

eRegister can prepare and file your state sales tax registration for $199 per state; see sales tax registration.

This guide is general information, not tax advice. If you are unsure whether you have nexus in a state, check with the state.