Determine economic nexus obligations across US states after Wayfair and configure nexus in a tax calculation engine

Steps

1. Audit your sales data by state for the current and prior calendar year, aggregating both revenue and transaction counts; compare against each state's economic nexus thresholds, which vary by state in both dollar amount and transaction count
2. Identify states where you have crossed or are approaching the threshold; note that some states apply the threshold on a prior-year lookback while others use a rolling 12-month window — consult each state's department of revenue for the current rule
3. For each state where nexus is triggered, register with the state's department of revenue for a sales tax permit before collecting and remitting tax; registration timelines and effective dates vary by state
4. In TaxJar, navigate to Account > State Settings and add each nexus state with the correct nexus type (economic, physical, or both) and the date nexus began; the nexus start date affects which transactions TaxJar includes in return calculations
5. Re-test the TaxJar Tax endpoint (POST /v2/taxes) for transactions to states you newly added as nexus states to confirm TaxJar now returns a tax amount rather than zero for those destinations
6. Set up ongoing monitoring by periodically querying your order management system for state-level sales totals and comparing against thresholds; automate an alert when 80% of a state's threshold is reached