Does your LLC have to collect US sales tax? Nexus, state by state

It's one of the scariest and worst-explained questions out there: "do I have to collect sales tax —the US tax on sales— from my customers?". The bad news is there's no universal yes or no. The good news is that the rule deciding your case is understandable, and for most non-resident LLCs the answer is calmer than it looks.

The starting mistake is almost always the same: thinking sales tax works like income tax. It has nothing to do with it. Let's separate the pieces.

Sales tax is not a federal tax: it's a state tax

There is no "US sales tax". It's set by the states (and sometimes cities and counties on top). Around 45 states plus Washington D.C. apply it; five have no state sales tax: New Hampshire, Oregon, Montana, Delaware and Alaska (though Alaska lets its municipalities charge it).

This has a consequence that breaks a lot of assumptions: the state where you formed your LLC barely matters for sales tax. Forming in New Mexico, Wyoming or Delaware does not "exempt" you from anything — what matters is where your customers are and whether you have nexus with that state. If you care about the formation-state angle, we compare it in Wyoming vs New Mexico vs Delaware.

What decides everything: "nexus"

Nexus is the sufficient connection with a state that forces you to register, collect and remit its sales tax. Without nexus in a state, you don't collect its tax. There are two ways to have it.

Physical nexus

The classic one: you have a tangible presence in the state. An office, employees, or —the case that catches many sellers— inventory stored there. If you use Amazon FBA and your stock sits in a California or Texas warehouse, that can create physical nexus in that state even if you live on another continent.

Economic nexus (the 2018 Wayfair rule)

Until 2018 you needed physical presence. The Supreme Court ruling South Dakota v. Wayfair changed it: now crossing a certain sales volume in a state creates nexus without ever setting foot in it. The typical threshold is $100,000 in sales or 200 transactions a year in that state — but each state sets its own (California and Texas, for example, put it at $500,000).

And there's a recent trend: since 2025-2026 more than fifteen states have dropped the 200-transaction threshold and keep only the dollar one ($100,000). This helps exactly those who make many small sales: you no longer accumulate nexus by order count, only by revenue.

Nexus doesn't look at your passport or where you registered the LLC. It looks at where your activity is: your customers, your inventory, your volume. That's why a non-resident can owe sales tax in one state and nothing in the other 49.

Being a non-resident doesn't exempt you

It's worth saying plainly because the opposite myth circulates: being a foreigner or not living in the US is not an exemption. Sales tax is based on the destination of the sale and on nexus, not on who you are. If you cross Florida's economic threshold selling to Florida customers, it doesn't matter if you're in Madrid or Buenos Aires: that state expects you to register and collect.

The reason many non-residents end up with no real obligation isn't their residence — it's what they sell and to whom.

Do your sales owe sales tax? It depends on WHAT and to WHOM you sell

Here's the piece that really changes your case:

• Services and consulting — in many states they are not subject to sales tax. If your LLC sells consulting hours or professional services, there's often no tax to collect (but watch out: some states tax certain specific services).
• Software (SaaS) and digital products — this is the most uneven area. States like New York, Texas or Washington tax SaaS; many others don't. Here you have to check state by state where you have nexus.
• Physical products to end consumers in the US — the case that almost always does create an obligation when there's nexus. It's the textbook sales tax scenario.
• Sales to customers outside the US — these are not sales subject to US sales tax. If you sell to Europe or Latin America, that portion doesn't enter the equation.

That's why the typical non-resident LLC —billing services or software to companies, often outside the US— tends to have a small or nil sales tax footprint. Not because of being a non-resident, but because of the type of sale.

If you sell on Amazon, Etsy or eBay: the marketplace collects for you

Good news for product sellers: almost every state has "marketplace facilitator" laws. It means Amazon, Etsy or eBay itself calculates, collects and remits the sales tax on those sales for you. You don't register for those transactions.

Two important nuances: (1) those marketplace sales do usually count toward your nexus thresholds in many states, and (2) if you also have FBA inventory in a state, that stock can create physical nexus that affects your sales outside the marketplace. The marketplace takes work off your plate, it doesn't wipe you off the map.

And if I DO have nexus in a state? The three steps

When a state applies to you, the process is always the same and isn't improvised:

1. Register for a sales tax permit in that state — it's actually one of the most common state permits for a non-resident. Collecting without a permit is illegal in many places.
2. Charge the correct rate on each sale — and the rate often depends on the customer's address (state + county + city), not yours.
3. File and remit on the schedule the state assigns you (monthly, quarterly or annually). The money you collect isn't yours: you hold it for the state.

Is sales tax the same as Form 5472 or income tax?

No, and confusing them is costly. They are separate worlds:

• Sales tax is state-level, you charge it to your customers and remit it to a state. It goes by nexus.
• Form 5472 + 1120 is federal and informational, goes to the IRS and doesn't depend on whom you sell to. Every single-member foreign-owned LLC files it.

You can owe one and not the other. A non-resident LLC selling services outside the US probably won't collect sales tax and yet must still file the 5472. The income coming in is still your LLC's revenue — we cover that in invoicing with your LLC.

Does forming in a state without sales tax free me from collecting it?

No. It's the most expensive confusion of all. Forming in Delaware (no state sales tax) —or in New Mexico, which instead levies its own Gross Receipts Tax— does not remove your obligation in the states where you have nexus. If you have inventory in Texas or cross the threshold in Florida, those states rule, not your formation state. The formation state matters for other things —registered agent, privacy, real cost— but it doesn't switch off someone else's sales tax.

Where sales tax fits within the rest of your LLC's annual obligations is laid out in the tax obligations guide. And since the rules change from state to state and year to year, as soon as you sell physical product or SaaS to US customers at volume, it's worth confirming your nexus map with a professional: the answer always depends on your specific case. And remember that sales tax covers the money you collect from US customers; if you also pay US freelancers, the other side of the paperwork is 1099 forms.