Update: Indiana DOR Prepares to Move Forward with Out-of-State Sales Tax

Indiana DOR Prepares To Move Forward With Out-of-State Sales Tax

INDIANAPOLIS— The Indiana Department of Revenue (DOR) is announcing next steps after the U.S. Supreme Court issued its landmark decision in South Dakota v. Wayfair, Inc on June 21, 2018. 

Out-of-state retail merchants with annual gross revenues from Indiana sales exceeding $100,000, or 200 or more separate Indiana transactions will need to register and remit Indiana sales tax.  

Pending resolution of a declaratory judgment action filed in 2017, DOR will begin enforcing Indiana’s economic nexus law on October 1, 2018, on a prospective basis. 

The Wayfair decision overturned the Court’s 1992 ruling in Quill Corp. v. North Dakota, which required a retail merchant to have a physical presence in a state to be subject to state sales tax registration and collection requirements.

Indiana’s existing “economic nexus” law, effective July 1, 2017, is found at IC 6-2.5-2-1(c), and provides that a retail merchant that does not have a physical presence in Indiana shall collect the gross retail tax on a retail transaction made in Indiana if certain threshold requirements are met.

The law, which was challenged in the fall of 2017 and remains subject to a pending declaratory judgment action regarding its constitutionality, is directly impacted by the outcome of the Wayfair decision.

Remote sellers seeking to comply with the laws of multiple states (including Indiana) should register with the Streamlined Sales Tax Registration system at www.streamlinedsalestax.org. Remote sellers seeking to comply with only Indiana’s economic nexus law should register through the online portal, INBiz, at www.inbiz.in.gov.

DOR will continue to be a resource for both out-of-state and in-state merchants. In addition, DOR will continue to provide further updates online at www.in.gov/dor. Interested parties may subscribe to receive email updates as more information is provided on the website.

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Indiana Department of Revenue: The mission of DOR is to serve Indiana by administering tax laws in a fair, secure and efficient manner.