First we must advise that we are NOT tax counsel, and you should seek specific clarification from your own accountants and counsel. Having said that, we can give you our interpretation based upon your questions:

First, these new reporting and notice requirements apply to ALL sellers who choose to NOT specifically register and begin collecting and remitting sales tax on sales to Colorado purchasers.

Next, these new reporting and notice requirements have nothing to do with local Colorado affiliates, or any constructed or presumed nexus provisions as are being pursued by several other states.

Finally, yes, there is a threshold – you do not have to report or provide notices unless you process more than $100,000 worth of sales to Colorado purchasers. HOWEVER, how are you to know if or when you will cross that threshold? Perhaps you could simply do nothing, and then suspend all sales to Colorado purchasers once your sales volume gets to $99,999, and then wait until your 12 month look back has moved forward by a month, then you could resume sales until you reach that ceiling again. Not likely a good solution. So, if you expect you will get anywhere close to the threshold, you should immediately implement notice mechanisms, and prepare for the annual statements to purchasers, and accounting reports to the Colorado Dept. of Revenue.

Once again, these are simply our thoughts; you should review the situation with your own counsel, and make your plans based upon their best advice.

Thank you for your well considered questions!

Do the notice requirements only apply to remote retailers that do not collect sales tax, and are part of a controlled group of corporations that contains a retailer with a physical presence in Colorado?

Or do the notice requirements apply to all retailers that sell into Colorado regardless of nexus, and regardless if the remote retailer has an affiliate with a physical presence in Colorado?

Can the state impose information reporting requirements on remote retailers that lack nexus on their own just because an affiliate has nexus, if the affiliate does not act or represent the remote retailer in any way?

Are remote retailers that sell less than $100,000 to Colorado purchasers in a year, exempt from the notification and filing requirements? (The emergency regulations provide for this exemption; the legislation does not.)

What do you think?

Thanks.

It is scheduled for a hearing before the Missouri Senate Ways and Means Committee on 2/24/2010

http://www.silive.com/newsflash/index.ssf?/base/national-15/1265687571265430.xml&storylist=simetro&thispage=1

They also discussed nexus related to business activity taxes, telecommunications taxes, and mobile workers – but those other nexus intensive issues are off-topic for our purposes here.

Fascinating!

Please see Honolulu Advertiser article:http://www.honoluluadvertiser.com/article/20090716/NEWS01/907160340/Hawaii+Legislature+allows+veto+of+oil+tax++overrides+38+others

thank you,
Carol Fukunaga

Chair, Senate Economic Development & Technology Committee
PH: 808-586-6890
FX: 808-586-6899