Wisconsin Implementing South Dakota Out of State Tax Collection Trigger by Administrative Rule

Following up on an earlier memorandum and answer from the governor’s office that Wisconsin aimed to begin expanded out of state seller sales tax collection October 1, 2018, the Wisconsin Department of Revenue has announced in a July 5 release that the minimum sales level at which it will force collection will be the same levels as those Justice Kennedy commented favorably on in the case of South Dakota v. Wayfair.

This notice was followed up by a formal Statement of Scope (SS 079-18) which provided official notice that that Wisconsin Department of Revenue was drafting rules to implement this decision.  This would have the effect of adding the South Dakota trigger amounts to Wisconsin law by an administrative rule rather than by an act of the state legislature.

The original memorandum had not indicated the specific trigger levels at which Wisconsin would look to force collection, but that detail is spelled out in the later release.

Standards for administering sales tax laws for online and other remote sellers will be provided by administrative rule. The rule will be consistent with the Court’s decision in Wayfair, which approved a small seller exception for sellers who do not have annual sales of products and services into the state of (1) more than $100,000, or (2) 200 or more separate transactions

The notice indicates that more information for online and remote sellers collecting sales tax can be found at https://www.revenue.wi.gov/Pages/Businesses/remote-sellers.aspx.