Economic Nexus Thresholds
By State (2025)
Since the 2018 Wayfair decision, states can require sales tax collection based on sales volume alone. Here's what triggers nexus in each state.
The Quick Version
- •Most states: $100,000 in sales OR 200 transactions
- •Texas, California: $500,000 in sales (no transaction threshold)
- •New York: $500,000 AND 100 transactions (both required)
- •5 states: No sales tax at all (AK, DE, MT, NH, OR)
Full Threshold Table
For the 10 states we cover in detail, plus SaaS taxability:
| State | Revenue Threshold | Transaction Threshold | SaaS Taxable? | Details |
|---|---|---|---|---|
| Texas | $500,000 | None | Yes | Revenue only, aggressive enforcement |
| California | $500,000 | None | No | SaaS exempt as non-tangible |
| New York | $500,000 | 100 (AND) | Yes | Must meet BOTH thresholds |
| Florida | $100,000 | None | No | SaaS exempt as service |
| Pennsylvania | $100,000 | None | Yes | Taxes "canned software" |
| Illinois | $100,000 | 200 (OR) | Partial | State exempt, Chicago taxes |
| Washington | $100,000 | None | B&O | No sales tax, but B&O tax applies |
| Massachusetts | $100,000 | None | Yes | Prewritten software taxable |
| Colorado | $100,000 | None | Complex | State exempt, home-rule cities vary |
| Georgia | $100,000 | 200 (OR) | No | SaaS exempt as non-tangible |
How Thresholds Work
Measurement Period
Most states look at the previous 12 months OR the current calendar year. Once you cross the threshold, you typically have 30-60 days to register.
OR vs AND
Most states use OR: you hit nexus if you exceed EITHER the revenue threshold OR the transaction count. New York is unusual: you must meet BOTH thresholds to have nexus.
What Counts as Revenue
Usually gross sales to customers in the state—including exempt sales. Some states only count taxable sales. Check each state's rules.
Don't Forget Physical Nexus
Economic nexus thresholds don't matter if you have physical presence (employees, contractors, inventory). Physical presence = nexus regardless of sales volume.
Common Questions
"I'm under all the thresholds. Am I safe?"
Only if you also have no physical presence. One remote employee in a state creates nexus regardless of your sales there.
"Do B2B sales count toward the threshold?"
Usually yes. The threshold measures your connection to the state, not whether the sales are taxable. You might cross the threshold on B2B sales but only owe tax on B2C sales (if B2B is exempt).
"What if I just crossed the threshold?"
Register promptly. Most states give 30-60 days from crossing the threshold. You only need to collect tax on sales after you have nexus, not retroactively.
"Do I need to register in states where SaaS is exempt?"
Often yes, if you have nexus. You may need to file $0 returns. California is an exception—they don't require registration just for exempt sales.
Check Your Threshold Status
Enter your revenue and employee locations to see which states you've crossed thresholds in—and whether SaaS is taxable there.
Check My Thresholds