NV Sales Tax 101 Sales Tax Rates

Online Sales Tax and Nevada: What Online Sellers Should Know

by Mark Faggiano

Nevada sales tax

This blog post may now be out of date. For our most up-to-date info on Nevada sales tax, check out our “Nevada Sales Tax Guide for Businesses.”

This post is for online sellers with ties (either actual or potential) to the State of Nevada for sales tax purposes. Hopefully this will give you a better idea of when you’re required to collect sales tax in Nevada and how much to collect. I’ve based the following cases on the most common scenarios we see with our TaxJar customers. As always, if you and your business don’t fit into any of the following scenarios, your best option is to contact a tax professional and get some guidance.

Online Sellers Without Any Ties to Nevada

If you’re an online seller living in a state other than Nevada and your business has no presence in the state (no inventory, no salespeople) then you can stop reading this post. Cheers!

Online Sellers Living in Nevada

If you’re an online seller living in Nevada then it’s probably safe to assume that your business is also based there as well. If that’s true then your business has sales tax nexus to the state. This means you are required to register your business with the Nevada Department of Taxation. The cost if $15 per business location, and the state may also require a security deposit. Nevada provides a handy walk-thru to help you register for your Nevada sales tax permit.

Since you live and operate your business in Nevada, this also means you need to begin collecting sales tax on orders shipped to addresses in Nevada. I’ll go through how to determine how much sales tax you’re required to collect a bit later in the post.

Out-of-States Online Sellers Using a Fulfillment Service

Let’s say you live in North Carolina (or any state other than Nevada) and you use a fulfillment service that warehouses and ships your inventory from a location in Nevada. According to Nevada state law, you have sales tax nexus in Nevada and must collect sales tax from buyers in Nevada.

We spoke on the phone to the Nevada Department of Taxation to ask about this and they referred us to NRS 372.724.

(Click to enlarge or visit the website to read the full statute)

Nevada Sales Tax Nexus

When asked the meaning of “satisfy the requirements under the United States Constitution” they directed us to the Quill Corp. v. North Dakota case and said that a presence, such as inventory in a warehouse, does constitute sale tax nexus.

Collecting Nevada Sales Tax

If you live or have a physical presence in Nevada, then you are required to collect sales tax on sales into Nevada. How much you should collect is the next piece you need to figure out. The key thing to understand is that Nevada is a destination-based sales tax state – in other words, the sales tax rate you collect is based on the location of your customer. It is not based on your businesses location.

The state’s Department of Taxation has provided a handy map of local sales tax rates throughout the state of Nevada.

Here are a couple of examples on how you would collect sales tax as a Nevada seller:

If you live in Nevada:

Let’s say you live in Orovada in Humboldt County, and a customer who lives in Reno, in Washoe County, makes a purchase from you. You would charge sales tax based on the location where your buyer lives. In this case, you would charge 7.725%, the Washoe County tax rate.

If you don’t live in Nevada, but have “nexus” in Nevada:

If you live in say, Charlotte, North Carolina, but use FBA and have items warehoused in an Amazon Fulfillment Center in Nevada, then you must still charge sales tax. Just like with the above example, you would charge sales tax based on the rate where your buyer lives. If your buyer lives in Eureka County, then you would charge 6.850% sales tax.

Filing Sales Tax in Nevada

If you need to file a sales tax return in Nevada, TaxJar has your back. You can now enroll in AutoFile for the state of Nevada and we’ll automatically file your sales tax return for you! Find out more at TaxJar.com.

Summary: If Your Business Has Nexus in Nevada, Collect Sales Tax on the Shipping Address

The two most common ways to establish nexus in Nevada is by living and operating your business there or by sending your inventory there through a service like FBA. If you have nexus, register your business with the state and collect sales tax based on the address where the item is being delivered.

Got questions? Feedback? Tell me about your experience selling in Nevada in the discussion section below.

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  • Todd Ryks

    Mark, Nevada wants $200 for a “Non-Title 7 NV Business License”. Is what you’ve seen or am I registering for the wrong license. I don’t live in NV, but Amazon moved some of my products to a warehouse there.

    • Todd – It sounds like you’re registering for the wrong license. You don’t need a business license. You want a sales tax license, which gives you the ability to collect sales tax.

      • Todd Ryks

        Mark, I figured that out a few minutes after posting the question. Thanks for getting back to me.

      • Tim

        Mark,

        How can we register for a reseller’s permit in Nevada? Is it possible to do it online (directly without agents)?

  • Windsurfer

    Mark, since Nevada is a “destination based” sales tax state, how do online eBay businesses configure eBay to handle the various destination cities when there is only 1 location per state in eBay’s Sales Tax Table? Any workarounds?

    • Great question. eBay basically makes it impossible to collect sales tax accurately. You have 2 options: 1) collect at the state rate and pay any local taxes out of pocket. 2) collect at the highest rate in the state…this will ensure you don’t have to pay out of pocket. If you pick this option just be sure to pay whatever you collect.

      • Windsurfer

        Thanks Mark and what I’ll also do is refund the buyer the difference based upon their county. Each county has a different rate than the highest rate of 8.1% So if buyer pays at the 8.1% but their county is 7.25% then I’ll refund the difference to buyer and remit the correct 7.25% to the state of Nevada. What you said on number 2 above is what I thought about also. Thanks a bunch. Great site by the way. learning a lot. Hope I can get some work done now ha!

  • Hi there Mark, and thanks for this information. I live in NV and have had an online business for 7 years. At about the 3-year mark I started selling some hard goods (drop ship scenario). So I had to get a Sales and Use Tax ID. So every month (and later, every quarter) whenever I made a sale to someone living in NV, I had to report it on my Sales and Use Tax form.

    A couple years ago, I shut down that part of my business and no longer sell any hard goods. Everything I sell is in downloadable form. But I have still been reporting the hard goods part of the biz to the state — every time just writing down zero dollars. It’s getting ridiculous.

    I was thinking perhaps I could just close the account with NV, since that part of my business is now closed down. But it seems I have to prove that my entire business is closed. Is that correct? Or do I have to just continue writing zero dollars made from hard goods for the rest of my life?! :-/

    Thank you so much for your thoughts. 🙂

  • Hi Patty – given all of the specifics to your case, your best bet is to talk to a tax professional and get their advice. Here are some folks I trust can take care of you http://www.taxjar.com/sales-tax-accountant-directory/

  • mike

    for years l’ve been buying guns on line and shipped to nevada. all i pay is a $35 transfer fee. now the same store is charging me sales tax on something i did not buy in his store or in the stste of nevada;is it legal or a skim?

    • I’m not sure I’m following. In some cases if a store suddenly states charging you sales tax it’s because they realized that *they* have sales tax nexus in your state and should charge sales tax to customers there. A business could suddenly have sales tax nexus where they didn’t before due to something as simple as hiring an employee in your state or storing goods in a warehouse in your state. If you think they’re charging sales tax illegally you can always go to your state’s department of revenue and, usually for a small fee, look up their sales tax ID to make sure they are properly registered.

  • Isaac Hetzroni

    I am currently selling through FBA and have inventory in their Nevada warehouse. I received a letter saying that to charge sales tax in Nevada I will need to have a physical address in Nevada. The only tie I have to Nevada is FBA. What should I do?

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  • Call the Nevada Department of Revenue and explain your situation. We’ve heard about things like this happening to sellers from time to time and they can generally clear it up by speaking with someone on the phone. Here’s how to contact Nevada: http://www.taxjar.com/states/nevada-sales-tax-online/

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  • Keith Perry

    So as a direct sales business do you have to charge sales tax? I am a consultant for Lu La Roe. Thank You!!

  • Hi Keith,

    This is a great question, but something we haven’t looked into yet. It’s a hot topic, so I will write a blog post on it soon. Until then, I suggest consulting a cpa to make sure you’re covered. Here’s a great list of sales tax experts: http://www.taxjar.com/sales-tax-accountant-directory/

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  • Sapmt Guy

    I get the point about registering for a business permit but got surprised to learn I may also be subject to a use tax for supplies bought form outside of NV. Online supply sources without a business in NV don’t charge a state sales tax but it seems it still needs to be paid by way of the state Use Tax. Is my understanding correct?

    • Hi there,

      Yes, indeed. States require that buyers who buy something online (or by traveling out of state) for use within that state pay a “use tax.” That said, it’s very hard for states to enforce this and many taxpayers just don’t do it. Many aren’t even aware that they should! More about use tax: http://taxjar.wpengine.com/use-tax-definition/

  • melissa

    Hi, I am trying to set up sales tax, but was told that I have to sign up as a business first in my state ( exempt so I don’t have to pay the 200 fee as I am a home business) and THEN sign up with nevada tax to start collecting sales tax….I just started selling on ETSY a couple months ago and have made about 4 sales in person..Do I need to pay past sales tax on these things?

    • Hi Melissa,

      While I’m not an accountant and can’t give you advice specific to your situation, we have an eBook on “When to Register for a Sales Tax Permit” that might provide you with some guidance. You can find it here: http://www.taxjar.com/guides/register-for-sales-tax/

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  • Annabella

    hi i am amazon online sellers registered in NV state. now I am confused if ” shipping credits” ” promotion rebates”” gift wrapping” are taxable along with the “product sales” derived from amazon ? thanks very much for your reply.

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