The principle
Sales tax is a tax on sales collected by states and sometimes by local governments. There is no federal equivalent of VAT.
The concept of nexus
A company must collect sales tax in a state when it has a sufficient connection there, called nexus: a physical presence (inventory, office, employees) or sales above thresholds set by the state (economic nexus).
Marketplaces
In most states, large marketplaces collect and remit sales tax themselves on sales made through them. Your direct sales, on your own website, remain your responsibility.
What about services?
Many states do not apply sales tax to most services, but the rules vary. A professional can check your situation state by state.
This article is for information only and is not legal or tax advice. The rules mentioned may have changed since the update date.
