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Our network is closely monitoring the latest information on several proposed "Nexus Tax" laws in multiple states (also called the Advertising Tax / Affiliate Tax / Amazon Tax). While some of these bills were defeated, several more are under consideration that will impact the affiliate marketing industry. These taxes could directly impact your business and your source of income.

Why does this matter?

In most cases these bills require merchants to collect and remit sales tax from residents of those states because of working with affiliates in that state. As a result, some merchants may choose to end their relationships with resident affiliates to avoid this expense. For specific information on how this tax will impact your business, please contact your tax accountant.

For states that enacted the tax, what amount creates nexus?

Listed below is the information we’ve collected as of September 2011:

• Arkansas: $10,000 in sales via affiliates in previous 4 quarters to Arkansas residents.
• California: $10,000 in sales via affiliates and $500,000 in total sales to California residents in previous 4 quarters.
• Connecticut: $2,000 in sales via affiliates in previous 4 quarters to Connecticut residents.
• Illinois: $10,000 in sales via affiliates in previous 4 quarters to Illinois residents.
• New York: $10,000 in sales via affiliates in previous 4 quarters to New York residents.
• North Carolina: $10,000 in sales via affiliates in previous 4 quarters to North Carolina residents.
• Rhode Island: $5,000 in sales via affiliates in previous 4 quarters to Rhode Island residents.
• Vermont: tax won’t go into effect unless it passes in a total of 15 other states

Multiple sources stemming from http://performancemarketingassociation.com/nexus-tax/affiliate-nexus-tax-the-states

What about other states?

Similar laws are being discussed in multiple states. The following online resources can help provide information for your area. Please consider contacting your state representatives to share your opinion on this issue.

• Performance Marketing Association Internet tax updates
• ABestWeb Affiliate tax laws section
• Affiliate Summit Forum General discussion, with conversations on topics such as "Safe States"
• Modern Main Street website