{"id":7028,"date":"2024-07-15T19:20:27","date_gmt":"2024-07-15T19:20:27","guid":{"rendered":"https:\/\/greerwalker.com\/?p=7028"},"modified":"2024-10-11T17:00:12","modified_gmt":"2024-10-11T17:00:12","slug":"north-carolina-enacts-changes-to-its-economic-nexus-standard-for-sales-tax","status":"publish","type":"post","link":"https:\/\/greerwalker.com\/north-carolina-enacts-changes-to-its-economic-nexus-standard-for-sales-tax\/","title":{"rendered":"North Carolina Enacts Changes to its Economic Nexus Standard for Sales Tax"},"content":{"rendered":"<p>Effective as of July 1, 2024, the NC legislature has changed its economic nexus standard for sales tax.\u00a0 The new law (NC H.B. 228) repeals North Carolina\u2019s 200 transaction based economic nexus annual threshold for purposes of requiring remote retailers and marketplace facilitators to collect and remit North Carolina sales and use tax.<\/p>\n<p>This law change leaves in place the gross sales in excess of $100,000 threshold from remote sales sourced to North Carolina for the previous or current calendar year.<\/p>\n<p>North Carolina Department of Revenue has issued Sales Tax Directive 24-1 which indicates North Carolina\u2019s remote seller nexus thresholds now consist of the following:<\/p>\n<ul>\n<li>The retailer makes gross sales in excess of $100,000 from remote sales sourced to North Carolina, including sales as a marketplace seller, for the previous or the current calendar year, or<\/li>\n<li>The retailer is a marketplace facilitator that makes gross sales in excess of $100,000, including all marketplace-facilitated sales for all marketplace sellers, from sales sourced to North Carolina for the previous or the current calendar year.<\/li>\n<\/ul>\n<p>The administrative guidance also addresses how a remote seller may cancel its current North Carolina registration if it meets the following requirements:<\/p>\n<ul>\n<li>It did not make gross sales sourced to North Carolina of more than $100,000 during 2023;<\/li>\n<li>It did not make gross sales sourced to North Carolina of more than $100,000 from January 1, 2024, through the date it cancels its registration in 2024; <u>and<\/u><\/li>\n<li>It is not otherwise engaged in business in North Carolina.<\/li>\n<\/ul>\n<p>You can read more about this change from NCDOR Directive 24-1 at the link below.<\/p>\n<p><a href=\"https:\/\/www.ncdor.gov\/sd-24-1-repeal-transaction-thresholdpdf\/open\">https:\/\/www.ncdor.gov\/sd-24-1-repeal-transaction-thresholdpdf\/open<\/a><\/p>\n<p>Please note, the law change above has no impact on sellers which have a physical presence within North Carolina.\u00a0 Sellers with employees, inventory, fixed assets, or other physical connections to the state are deemed to have nexus for sales tax regardless of whether their gross receipts exceed the $100,000 test or not.<\/p>\n<p>North Carolina joins a growing number of states that have adopted revisions to their economic nexus standards for sales tax to eliminate a transaction count threshold.\u00a0 These states are finding the dollar amount threshold a more effective measure of significant activities.\u00a0 This also relieves some confusion within the business community about how to determine what represents a \u201ctransaction\u201d for this test.<\/p>\n<p><strong>About GreerWalker LLP<\/strong><\/p>\n<p>GreerWalker LLP provides tax, accounting, and advisory services focused on the needs of privately-held middle-market companies and their owners throughout the US and around the globe.<\/p>\n<p>Our affiliate GreerWalker Corporate Finance LLC offers exit planning and merger and acquisition services to provide a complete, integrated solution for middle market companies and their owners.<\/p>\n<p>Customized wealth planning for every stage of life is offered through our strategic partner, Choreo, LLC. Choreo, LLC is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Registration as an investment adviser does not imply a certain level of skill or training of the adviser or its representatives.<\/p>\n<p>With over 135 associates, we are one of the ten largest CPA firms in our region and among the top 200 CPA firms in the United States. We have repeatedly been recognized as one of the nation&#8217;s &#8220;Best of the Best\u201d accounting firms by Inside Public Accounting based on our overall superior financial and operational performance.<\/p>\n<p><strong>About the Author<\/strong><\/p>\n<p><a href=\"https:\/\/greerwalker.com\/team_member\/jason-pritchard\/\">Jason Pritchard<\/a> is a partner in GreerWalker\u2019s Greenville, SC tax practice.\u00a0 Jason joined GreerWalker in 2017.\u00a0 Prior to joining the firm, Jason was most recently responsible for the oversight of state &amp; local tax accounting and compliance at a global top five financial institution.<\/p>\n<p>In addition, Jason spent 10+ years at a Fortune 50 retail company where he was responsible for all aspects of federal, state &amp; international taxation.\u00a0 Jason has 20+ years of experience evaluating and resolving US federal and state audit issues, the financial evaluation of proposed mergers and acquisitions and in the development and implementation of strategic business technology. Jason also works with clients to identify and implement federal, state &amp; local tax and development incentives.<\/p>\n<p>For questions and guidance about these changes, reach out to Jason at <a href=\"mailto:jason.pritchard@greerwalker.com\">jason.pritchard@greerwalker.com<\/a> or (864) 752-0084.<\/p>\n<hr style=\"margin: 0.8em 0 2.20em 0; border-top: 0px solid #fff; border-right: 0px solid #fff; border-left: 0px solid #fff; border-bottom: 1px solid #AAAAAA;\" \/>\n<p class=\"disclaimer_text\">The information contained herein is general in nature and based on authoritative guidance that is subject to change. Neither GreerWalker LLP nor GreerWalker Corporate Finance LLC (collectively, \u201cGreerWalker\u201d) guarantee the accuracy or completeness of any information and are not responsible for any errors or omissions, or for results obtained by others as a result of reliance upon such information. GreerWalker assumes no obligation to inform the reader of any changes in tax laws, regulations, accounting standards, or other factors that could affect information contained herein. This publication does not, and is not intended to provide legal, tax or accounting advice, and readers should consult their advisors concerning the application of tax laws or accounting guidance to their particular situation. Any tax analysis in this publication is not advice and is not intended or written to be used, and cannot be used, for purposes of avoiding tax penalties that may be imposed on any taxpayer.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Effective as of July 1, 2024, the NC legislature has changed its economic nexus standard for sales tax.\u00a0 The new law (NC H.B. 228) repeals North Carolina\u2019s 200 transaction based economic nexus annual threshold for purposes of requiring remote retailers and marketplace facilitators to collect and remit North Carolina sales and use tax. This law [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":4249,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_yoast_wpseo_opengraph-image":"","_yoast_wpseo_opengraph-image-id":"","_yoast_wpseo_twitter-image":"","_yoast_wpseo_twitter-image-id":"","_editorskit_title_hidden":false,"_editorskit_reading_time":0,"_editorskit_is_block_options_detached":false,"_editorskit_block_options_position":"{}","footnotes":""},"categories":[26,13,10],"tags":[130,131],"class_list":["post-7028","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-article","category-business","category-tax-alert","tag-business","tag-tax"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Sales Tax Liability Update for NC Builders<\/title>\n<meta name=\"description\" content=\"In this article, our expert business advisors share tips on how you can navigate north carolina sales tax changes smoothly. Call us today for more details.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/greerwalker.com\/north-carolina-enacts-changes-to-its-economic-nexus-standard-for-sales-tax\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Sales Tax Liability Update for NC Builders\" \/>\n<meta property=\"og:description\" content=\"In this article, our expert business advisors share tips on how you can navigate north carolina sales tax changes smoothly. 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