Jun 08, 2015
From KPMG TaxWatch
On May 27, 2015, Nevada Governor Brian Sandoval signed Assembly Bill 380, which establishes affiliate and click-through nexus standards for Nevada sales and use tax purposes. The affiliate nexus provisions create a presumption that a retailer is required to impose, collect, and remit sales and use taxes if the retailer is: (1) part of a controlled group that has a component member with physical presence in Nevada; and (2) the component member with physical presence engages in certain activities in Nevada that facilitate the retailer’s ability to establish or maintain a market in the state. Among the activities by the in-state entity that are cited as potentially creating a presumption of nexus for the out-of-state entity are selling the same or a similar line of products or services under a similar business name and using trademarks or service marks that are the same or substantially the same as the remote seller. A retailer may rebut the presumption by providing proof that the component member with physical presence in the state did not engage in any activity in Nevada that was significantly associated with the retailer’s ability to establish or maintain a market in Nevada for the retailer’s products or services. The affiliate nexus provisions become effective July 1, 2015.
The click-through nexus provisions create a presumption that a retailer is required to impose, collect, and remit sales and use taxes if the retailer enters into an agreement with a Nevada resident under which the resident receives a commission or other consideration, based on the sale of tangible personal property by the retailer, for referring potential customers to the retailer through a link on the resident’s internet website or otherwise. The presumption is created only if the cumulative gross receipts from sales by the retailer to Nevada customers through all such referrals exceeds $10,000 during the preceding four quarterly periods. A retailer may also rebut this presumption by providing proof that each resident with whom the retailer has an agreement did not engage in any activity that was significantly associated with the retailer’s ability to establish or maintain a market in Nevada for the retailer’s products or services during the preceding four quarterly periods. The click-through nexus provisions become effective October 1, 2015. For more information on Nevada AB 380 (signed May 27, 2015), please contact Lorna Pederson at 480-459-3598.
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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.
The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.