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South Dakota v. Wayfair Update: Minnesota

In a June 21 statement from the Minnesota Department of Revenue regarding South Dakota v. Wayfair, the department said it was currently analyzing the decision and how it will affect Minnesota and its online retailers, remote sellers and marketplace providers. The Minnesota Department of Revenue has stated that it will provide guidance within 30 days.

The announcement confirms that retailers already collecting and remitting tax to Minnesota, either directly or through a third party, should continue.

Out-of-state retailers that want to begin collecting and remitting taxes in Minnesota can register through the Streamlined Sales Tax Registration System.

Update: Following their initial statement regarding South Dakota v. Wayfair, the Minnesota Department of Revenue announced on July 25 it will require remote sellers and marketplace facilitators to begin collecting sales tax no later than October 1, 2018.

Minnesota has a Small Seller Exception, which does not require remote sellers to collect sales tax until their sales during a period of 12 consecutive months total either:

  • 100 or more retail sales totaling $100,000 or less shipped to Minnesota, or
  • 10 or more retail sales totaling more than $100,000 shipped to Minnesota.

The Court’s decision in Wayfair also caused Minnesota’s 2017 Marketplace Provider law to become effective, requiring certain marketplace providers to collect and remit Minnesota sales tax on all taxable retail sales made into Minnesota facilitated by the marketplace.

New Sales Tax Landscape for Online Sellers

The recent U.S. Supreme Court ruling in South Dakota v. Wayfair overturning the long-held Quill decision will dramatically change the landscape for online sellers when it comes to sales tax.

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