Sales Tax Compliance & Filing FAQs for Ecommerce Businesses
What is nexus?
Sales tax nexus refers to a business’s connection or presence in a US state that creates a tax obligation. It’s triggered by being physically present in a state, or by conducting transactions in a state, even if you have no physical presence there. In this case, the volume of sales in a certain state (dollars earned or transactions completed) is what determines if you have nexus there. Click-throughs can also trigger nexus, so there’s a lot to stay on top of.
Can RJM Tax Exemption help me figure out where I have nexus?
Yes. This is a key first step in the sales tax exemption process. Because each state sets its own thresholds, it can be challenging to figure out if nexus applies to you in a given state. We can help you sort through your obligations and advise you on where sales tax permits are needed.
Why do I need to submit sales tax returns?
In most states, collecting sales tax on purchases is mandatory. During the sales tax registration process, we open sales and use tax accounts with applicable US states. Once this is completed, it means your sales and use tax account is active. It is then your responsibility to keep your sales tax account up to date by submitting regular tax returns.
This is needed even if your store is not making any sales yet – in this case, a $0 sales return is required. Failure to submit your returns by their due date will result in tax delinquencies, such as late filing fees and overestimations of your owed tax.
How do I calculate sales tax, and will it be deducted automatically on the ecommerce platforms I use?
If your store is selling via a marketplace such as Amazon, Walmart, or eBay, these platforms will collect the sales tax for you and remit it back to the states automatically. You will not have to make any payments from your account to the states.
However, if your store is selling via Shopify, your own website, or certain other platforms, you will have to collect the sales tax and remit it back to any state you have nexus in. RJM will help you keep track of what you must remit so you don’t miss crucial payments.
Why is RJM’s sales tax filing subscription helpful?
We provide a fully ‘hands-off’ sales tax compliance & filing service, where we access your sales reports, calculate your taxes, and submit your tax returns for each active ecommerce account within the US.
We do all of the monthly work where you have nexus, so you can focus on selling. The process is even simpler if we have completed your tax registrations, because we will already have all your login information and seller permits saved in our system.
Do you offer free consultations?
Yes. Just reach out to request a FREE assessment of your tax situation, and we’ll provide honest and accurate details to help you determine if our services are right for you. There’s no obligation to commit to using RJM, but we’re confident that our extensive knowledge can save you time and money on taxes, and more.
How much communication will I have with the RJM consultant assigned to my account?
Upon purchase of our sales tax filing monthly subscription, we’ll reach out to complete your onboarding with the sales tax compliance team. A consultant will then be assigned to your account, and they will work on your tax returns every month.
Please note that the sales tax filing deadline is the 20th of every month, and that filings are completed for the previous business month (e.g., in February, we submit tax returns for January; in March, we submit tax returns for February, and so on).
When your assigned RJM consultant has finalized your tax returns, they will be in touch with you via email to confirm that your taxes are completed and up to date. They’ll also provide you with any updates and note any payments that are due. This will happen every month.
You are encouraged to contact your assigned RJM consultant directly as your main point of contact if you have any questions not answered in these FAQs regarding sales tax compliance & filing, privacy, and billing.
Why do you need access to my store’s sales?
Taxes are based on sales. Your sales data, including any sales tax refunds, is required to accurately calculate your taxes and submit your tax returns. We understand you may have concerns and encourage you to review our privacy FAQs to learn more about how we handle your sensitive data.
Does an RJM subscription run on a contract basis?
No, our services do not run on a contract basis, and you can stop your subscription with us at any time. More information is available in our billing FAQs.
How is the monthly fee calculated?
Our monthly fees are based on how many filings we take care of each month. This provides predictable, consistent billing so our clients always know what to expect. Keep in mind, of course, that filings must be made even when you have no sales, so your monthly fee will not decrease if you don’t record a sale in a state in which you have an active account.
Will the RJM monthly fee increase or change based on the number of sales I make?
No, we do not base our charges on the size of your sales reports. Instead, our billing is based on the number of sales tax accounts we oversee each month. We provide flat rates, meaning that—unlike other platforms—our monthly fee will not increase even if you start making sizable sales. You won’t pay more for sales tax compliance & filing when you sell more.
How do I cancel my subscription?
Get in touch with your assigned RJM consultant or with our admin team, and they will be able to assist you with cancelling your monthly subscription so no further payments are debited from your account. When you cancel your subscription with us, we provide you with all of your login details so that you can continue to file for your tax returns and avoid tax delinquencies. For more information about cancellations, see our billing FAQs.
What if I am no longer in business and don't want to worry about filing tax returns?
If that is the case, we recommend you close all your sales tax accounts. If you simply stop submitting your returns and keep your accounts open, you will acquire large sums of tax delinquencies, which are then difficult to clear up. We can advise you through closing all of your accounts efficiently.
Why do I have to complete sales tax returns if my store is making no sales?
It is your responsibility to keep all of your sales tax compliance & filing up to date from the month your accounts are opened. This applies even if your store is not yet in business or in months when you have no sales.
Failure to submit your returns can result in late filing fees, overestimations of your owed tax, and, ultimately, forced closure of your accounts. This can cause myriad problems, including interference with your tax-exempt status.
Why have I acquired tax delinquencies and fines/penalty notices if my store is making no sales?
Once sales tax accounts are open, reporting must continue monthly until the account is closed. This means that even in months when you have $0 sales or small sums of income, you are still obligated to stay current on your sales tax compliance & filing. In other words, you ALWAYS file, even with no proceeds.
If you miss a month or have never filed due to not launching service in a particular state, and you have an open account, you may accumulate delinquencies, fines, and penalties for failing to file. Working with RJM ensures your obligations don’t fall through the cracks and you don’t fall into non-compliance with sales tax filings.
I just discovered my sales tax filing backlog! Can you help?
Don’t panic! It is very common for clients to reach out to us with large tax delinquencies because they weren’t aware of sales tax compliance & filing obligations and failed to keep up. Our RJM compliance team specializes in securing penalty waivers, and we will be happy to assist you through the process of getting your accounts back to good standing.
What is the ‘RJM backlog fee’ and why do I have to pay it?
We charge a basic monthly fee per backlog period if we need to work through a delinquent account. For example, if your monthly sales tax filing subscription would be $100 per month, and you find yourself with a backlog of 5 months, we will charge $100 × 5 = $500 to clear the backlog. Note that during the backlog clearance, we will work to secure penalty waivers and complete additional paperwork in order to get your tax delinquencies cleared up and your backlogged tax returns up to date.
Don’t see your question in these sales tax compliance & filing FAQs? Feel free to reach out.
Security & Privacy FAQs for Ecommerce Businesses
How do you keep my personal information secure?
We abide by strict data protection procedures and store all client information on the secure platform of Google Sheets. This data is only accessible to clients, who can access their information by logging in with their personal email password—this is also the case for our staff.
Your data can be deleted as soon as we’ve completed the application process. This only takes a few days from when you submit your information. We have dealt with thousands of clients all over the world and have never had a security breach or data leak.
Why do you need my Social Security Number?
Your Social Security Number (SSN) is required by the states as part of the sales and use tax account applications that establish sales tax compliance. These applications are completed via online forms, and most states will not allow the application to progress unless all requested information is provided.
What if I am not a US citizen and don’t have an SSN?
If you are not a US citizen and do not have an SSN, you may be able to use an Individual Taxpayer Identification Number (ITIN) or a passport number instead, depending on the requirements of the state(s) where you’re applying. RJM can help you navigate each state’s rules and secure the acceptable documentation for sales tax compliance.
Why do you need my driver's license, government ID, and/or passport?
Many states require applicants to provide proof of identification to approve sales tax exemption applications or to establish tax accounts. This applies to both US-based and foreign applicants.
Why do you need my banking information?
Your banking information is required by many individual state agencies in order to maintain sales tax compliance. As is the case with photo identification and SSNs/ITINs, bank details must be provided to move forward in the application process. As noted in the first privacy FAQ above, your taxpayer numbers, identification, and banking information are only necessary during the application process and can be deleted when this process is completed.
Don’t see your question in these security & privacy FAQs? Feel free to reach out.
Payments & Billing FAQs for Ecommerce Businesses
How soon will I be onboarded once my payment has been submitted?
Our support team will be in touch via email within 48 hours of payment receipt with instructions regarding your sales tax compliance onboarding process. In the meantime, feel free to get in touch if you have any questions—our offices are open Monday to Friday from 9 a.m. to 5 p.m. (London Time Zone). Please note that if a purchase is made during the weekend, our support team will be in touch the following Monday.
How can I make payments to RJM?
We accept credit and debit cards, bank transfers, PayPal, and Bitcoin. If you are uncertain about your preferred payment method, reach out to our admin team for more information.
What if I think that I have found a better price from a competitor?
We are confident that our sales tax compliance pricing is the best in the industry. If a recognized and established company offers a better price, we’ll match it.
Simply complete a support request, and we’ll follow through. Do note that income tax filing is not subject to our price match guarantee and that other restrictions may apply.
What is your refund policy?
We can refund your one-off payment if no work has been completed, that is, if you change your mind before we begin.. We cannot refund the one-off fee if we have already gotten to work.
Regarding monthly sales tax filing subscription payments, these are non-refundable, as these are payments for completed sales tax compliance work. However, if you sign up for a subscription plan and no work has been done yet, we can refund your payment.
Do note that, as we are known for our timeliness, it is very likely that we will quickly complete the work you’ve requested, so your timeframe to request a refund may be limited.
Lastly, if you choose the annual payment option that saves you 25% on sales tax compliance fees and you need to cancel it halfway through the year, you can use the remaining credit towards another service we provide. However, no cash refunds are given in this case.
Don’t see your question in these business billing FAQs? Feel free to reach out.
