On June 21, the U.S. Supreme Court overturned the requirement that retailers must have a physical presence in a state to collect that state’s sales tax (South Dakota v. Wayfair). The Idaho State Tax Commission is still studying how the decision affects out-of-state retailers, such as online sellers, that make sales to Idaho citizens. We’re closely watching any actions by the U.S. Congress on this issue. We’ll also continue to follow developing legal issues arising from the decision.
The Tax Commission will implement a new law (House Bill 578) that requires out-of-state retailers to collect Idaho sales tax on their sales to Idaho customers when:
- The out-of-state seller has an agreement with an Idaho retailer to refer potential buyers to the out-of-state seller for a commission, and
- The total sales to the Idaho buyers exceeded $10,000 in the previous year.
The law goes into effect on July 1, 2018.
Any out-of-state retailer that’s required or wishes to collect the state sales tax for its Idaho customers can register online through tax.idaho.gov/ibr.
Idaho citizens who aren’t charged sales tax on their purchases owe a 6 percent use tax if the items are stored or used in Idaho. They can pay the use tax with their annual income tax return or at any time with Form 850-U, Idaho Self-Assessed Use Tax Return.