Rhode Island economic nexus threshold

Affiliate nexus

Rhode Island maintains two independent affiliate nexus provisions under separate statutes.

The first is click-through nexus under RIGL § 44-18-15, which establishes a rebuttable presumption of nexus when an out-of-state retailer enters into an agreement with an in-state resident who refers potential customers for a commission, and cumulative gross receipts from Rhode Island customers referred by all such in-state residents exceed $5,000 during the preceding four quarterly periods. This $5,000 threshold operates independently of the $100,000 economic nexus threshold and is not subject to the same annual evaluation period.

The second is affiliate nexus under RIGL § 44-18.2-2, which applies when an out-of-state seller has a related in-state entity that: sells similar products under the same or substantially similar business name; maintains an office, warehouse, store, or distribution facility in Rhode Island used to facilitate delivery to the remote seller's customers; or uses substantially the same trademarks, service marks, or trade names. The Rhode Island Division of Taxation addressed the scope of this provision in Administrative Decision 2018-11, holding that shared branding and common parent ownership alone are not sufficient to establish nexus. The in-state affiliate must be meaningfully performing activities on behalf of the out-of-state entity.

Physical nexus

Rhode Island imposes sales tax obligations on any seller "engaging in business" in the state. Physical nexus is triggered by maintaining any office, place of distribution, sales or sample room, warehouse, storage place, or other place of business in Rhode Island, whether permanently or temporarily, and whether operated directly or through a subsidiary or agent. The presence of employees, agents, or representatives conducting activities in the state independently creates nexus, as does maintaining a stock of goods or inventory in Rhode Island.

For trade shows and sample displays, Rhode Island applies a 14-day rule: maintaining a sample or display room for more than 14 days per tax year is nexus-creating, while 14 days or fewer in a tax year is protected and does not establish physical presence.

Trailing nexus

Rhode Island has not published a statute, regulation, or stand-alone guidance specifying a trailing nexus period for sales tax purposes. By analogy to corporate and sales tax nexus regulation CT 15-02, a seller with physical activity in Rhode Island in a given year should expect to remain registered and file returns through at least the end of that calendar year.