Nevada economic nexus threshold

Affiliate nexus

Nevada recognizes two distinct bases for nexus arising from in-state relationships: affiliate nexus and click-through nexus, each established by separate statutory provisions.

Under NRS 372.7243, a rebuttable presumption of nexus arises when a remote retailer is part of a controlled group under IRC Section 1563 that includes a component member with physical presence in Nevada, and that in-state member performs activities significantly associated with the retailer's ability to establish or maintain a market in Nevada. This provision was established by SB 412, effective July 1, 2015, and implementing rules became effective November 2, 2016.

Activities that trigger the affiliate nexus presumption include selling a similar product line under a similar name, maintaining warehouses or offices for the retailer's benefit, using the same trademarks or trade names, performing installation, repair, or maintenance services for the retailer's customers, and operating a trade show exhibit on the retailer's behalf. The presumption is rebuttable through written certification from the in-state affiliate demonstrating that no qualifying activity occurred.

Under NRS 372.7247, a separate rebuttable presumption applies when a remote retailer has commission-based referral agreements with Nevada residents and cumulative gross receipts from all such Nevada referrals exceed $10,000 during the preceding four quarterly periods ending on the last day of March, June, September, and December. Covered referral mechanisms include internet links, telemarketing, and in-person presentations. Passive or generic online advertising, such as standard banner ads and search engine links, does not trigger the presumption. The four-quarter rolling evaluation period for click-through nexus is distinct from the calendar-year basis used for economic nexus. The presumption is rebuttable with sworn statements from all referring Nevada parties certifying they did not solicit on the retailer's behalf.

Physical nexus

Any seller with physical presence in Nevada is required to register and collect sales tax regardless of sales volume. Physical presence triggers include a retail store, sales office, or other place of business; a warehouse, distribution facility, or storage location; employees, agents, or representatives operating in the state; and inventory held in Nevada, including inventory stored at third-party fulfillment centers or FBA.

Delivery of products into Nevada by means other than mail or common carrier also constitutes physical presence. With respect to trade show participation, having an exhibit to establish or maintain a market in Nevada creates nexus, while merely attending as a visitor without an exhibit does not.

Trailing nexus

Once the economic nexus threshold is crossed in a given calendar year, the obligation to collect Nevada sales tax continues through the end of that year and through the entire following calendar year. The obligation lapses only if the threshold is also not met in the following year.