Colorado Requiring out of state sellers with no nexus to file reports

[Lee B]

Copied from Accounting Today:

Colorado law requires out-of-state sellers making sales to Colorado residents to report certain information to the Colorado Department of Revenue, even when the out-of-state seller does not have nexus with the state. This law was originally enacted in 2010 but was effectively on hold while the law was challenged in the courts. The court cases challenging the law have become final, and Colorado is now permitted to enforce the law as written as of July 1, 2017.

The law applies to “non-collecting retailers” with total gross taxable sales to Colorado of $100,000 or more per year. “Non-collecting retailers” are out-of-state sellers who do not have physical presence in the state of Colorado, and therefore have no requirement to collect and remit sales tax on their sales to residents of that state. The law imposes three requirements on “non-collecting retailers” making sales to Colorado residents:

1. Sending a “transactional notice” to Colorado purchasers letting them know that they may be subject to Colorado’s use tax.
2. Sending an “annual purchase summary” to Colorado purchasers who buy more than $500 in goods from the retailer with the dates, categories, and amounts of purchases, reminding them of their obligation to pay use taxes on those purchases; and
3. Filing an annual “customer information report” with the Colorado Department of Revenue listing their customers’ names, addresses, and total amounts spent.
4. Penalties for failure to comply with these requirements can be significant.

First that I have heard of this. If other states follow suit, this will create a whole new reporting regime.

Is anyone aware of other states requiring this reporting ?

[Richcpaman]

I like that $100,000 limit.  Keeps most of us out of the game...

 

Rich

[Catherine]

8 minutes ago, Richcpaman said:

Keeps most of us out of the game...

And stops CO from trying to prosecute some poor dumb schmuck who sells one single $500 item to CO in a year.