Design Your Own Nexus Strategy

If tax nexus isn’t already part of your business vocabulary then now’s the time to get familiar with what it is, how it could impact you, and the potential cost to you and your business.

Tax nexus happens when a state can pull you inside their borders for taxes. You don’t have to be physically present in the state, either. We’ve seen a tidal wave of changes made by broke and hungry states looking to cash in. And, once you’re in, you’ve got a whole new set of rules to follow. Make a mistake and you could find your doors locked and your bank accounts emptied. Or, state auditors couldbe looking to you to make good on unpaid tax collections that go back for years.

Who is Impacted by Tax Nexus? Just about everyone. Here are just some examples:

  • Do you have offices in multiple states
  • Do you have have 1099 contractor relationships in multiple states
  • Do you have a website where people can purchase goods?
  • Do you advertise in multiple states?
  • Do you have an affiliate marketing program?
  • Do you have salespeople who attend conventions
  • Are you an affiliate marketer?

If you answer yes to any of those questions, you could potentially have a nexus issue.

Education is KEY

Your first step is to get educated on the issues you face and how they impact your business. To do that, start by downloading your copy of Create Your Own Nexus Strategy. This digital eBook is almost 150 pages long, and represents thousands of hours of research and analysis by authors, Diane Kennedy, CPA and Megan Hughes. The book covers:

  • Sales Tax Nexus Issues
  • Income Tax Nexus Issues
  • “Other” Tax Nexus Issues
  • Digital Download Tax Issues
  • The “Amazon” Tax and other issues facing Internet retailers
  • How states are using tricky nexus questionnaires to find new sources of revenue
  • What you can do to minimize the multi-state tax bite
  • … and more!

Over 95% of all businesses have underestimated their tax obligations to other states

That statistic, released in 2010, was prepared by a research company that specializes in nexus solutions. It’s a frightening statistic, if only for the fact that state tax officials are aware of the report. With such a massive percentage of businesses getting their nexus obligations wrong, audits and other state-led efforts to find business owners WILL increase.

Create Your Own Nexus Strategy is made up of three sections:

Section 1: Understanding Nexus. In this section, you will learn key nexus concepts and begin to identify general state nexus concerns for your business.

Section 2: Create Your Own Nexus Strategy. The next stage is relating that to your business. Learning where your problem areas are will be key – as will finding ways to minimize or even remove nexus triggers from your business operation.

Section 3: Implement Your Own Nexus Strategy. In Section 3, you’ll take everything you learned in Section 1, filter it through the nexus strategy you designed in Section 2, and put it to work in Section 3.

Nexus is not something that is going away. As a business owner, you have two choices: pay ever-increasing taxes without question, or develop a comprehensive plan to minimize your tax burden while keeping your company moving forward.