The Wayfair ruling ended the physical-presence sales-tax shield

The workload

Before June 2018, a solo software seller with no office or employee in a given state had one main sales-tax task: watch for state laws reaching across the border, then rely on a decades-old rule that a state could not require collection without a physical presence there. Verified: the Supreme Court's own opinion in South Dakota v. Wayfair, argued 17 April 2018 and decided 21 June 2018, records that South Dakota's legislature had passed a law reaching any out-of-state seller delivering more than $100,000 of goods or services into the state, or completing 200 or more separate transactions there in a year, requiring it to collect tax as if it had a physical presence. The workload the ruling created is ongoing: a seller must now track sales into every state with a similar economic-nexus statute, since the physical-presence shield the Court had recognized in 1967 and 1992 no longer exists.

What the documents show

Verified: the opinion holds that the physical-presence rule from National Bellas Hess and Quill Corp. v. North Dakota is unsound and overrules both decisions, finding that South Dakota's own $100,000-or-200-transaction threshold gives the state a nexus the Constitution's Commerce Clause allows it to tax. Verified: the case record maintained by Oyez, a Chicago-Kent College of Law project, independently confirms the argument and decision dates the opinion's own caption states. Neither document sets a national number. The ruling upholds South Dakota's own statute; it does not require any other state to copy its $100,000-or-200-transaction figure, and states have since set their own, different numbers.

The operating cost

The opinion prices no compliance fee in dollars, but it does describe what South Dakota built to lower the cost of the obligation it just upheld. Verified: the opinion notes South Dakota belongs to the Streamlined Sales and Use Tax Agreement, joined by more than twenty states, which the Court says provides sellers access to sales tax administration software paid for by the State, and that sellers using it are immune from audit liability. States outside that agreement make no comparable offer, so the real per-state cost is free state software, a paid tax-calculation service, or a founder's own spreadsheet, varying state by state rather than one national figure.

The stop condition

This is an editorial reading, since the opinion states no such rule generally: a reasonable point to stop tracking a state's exposure is after checking that state's own current statute and confirming sales there fall under its stated threshold, not South Dakota's, which the opinion addresses only for South Dakota's own law.

• Does the state in question publish its own economic-nexus threshold, and does current revenue or transaction volume clear it?
• Is that state part of the Streamlined Sales and Use Tax Agreement, with free administration software available to registered sellers?
• Has a registration or collection obligation already been triggered in a state nobody has checked since sales there grew?

Wayfair removed one national shield and replaced it with roughly fifty separate state tests, each of which still has to be checked on its own terms.