Idaho: Sales Tax Handbook
What constitutes sales tax nexus in Idaho?
One of the more complicated aspects of Idaho sales tax law is sales tax nexus, the determination of whether a particular sale took place within the taxation jurisdiction of Idaho, and is thus subject to state (and possibly local) sales taxes.
If a vendor's transactions are determined to have nexus in Idaho, the vendor must register for a Idaho sales tax license and collect appropriate sales taxes from the buyer for all transactions with nexus in the state. On this page, we have compiled some of the most commonly needed facts about what constitutes sales tax nexus in Idaho.
Sales Tax Nexus in Idaho
According to the law in the state of Idaho, retailers who have tax nexus can be defined in several distinct ways. To have tax nexus, the business must meet a minimum of one of the following requirements:
Having an office or any other place of business (including but not limited to sample rooms, warehouses, places of storage, or sales room) within the state, having any representative(employee, agent, salesman, independent contractor,etc.) who have come specifically to install, deliver, sell, or take orders in the state of Florida, keeping a stock of goods in the state, servicing tangible personal property in the state, or renting or leasing property(NOT real property) to any customer who utilizes the property in the state of Idaho.
For additional details on sales tax nexus law in Idaho, see the nexus information page from the State Tax Commission at https://tax.idaho.gov/i-1049.cfm
Taxation of Internet-Based Sales in Idaho
NOTE: 2018 Supreme Court Ruling Regarding Online Sales Taxes
In the 2018 Supreme Court case South Dakota vs. Wayfair Inc, Et Al., the court overturned a previous ruling that required a merchant to have physical nexus in order for a state to collect sales tax. This means that any state is now free to enforce collection of sales taxes on out-of-state online merchants. The information provided here may be subject to change, and many states are expected to begin collecting online sales taxes following this ruling.
Generally, Idaho does not charge sales tax on Internet-based transactions determined to have nexus within the state. This means that purchases from Amazon.com and other Internet-based retailers may be sales-tax-free.
The nexus status and taxability of Internet-based sales, by vendors and/or consumers within Idaho, have been the subject of hot debate in recent years. You can learn more on our introduction to Internet-based sales taxes.
Does my business have tax nexus in Idaho?
The folks at the sales tax compliance company Avalara are an approved Idaho sales tax partner, and you can use their free Idaho nexus wizard tool to determine whether or not your business has nexus, and is therefore required to pay Idaho sales taxes. If you're interested in automating your sales tax collection and filing process, click here to get more information.
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