What Are Some of the Consequences of Wayfair?
October 04, 2018
States will likely be emboldened to enforce economic nexus in other tax areas such as for income taxes and net worth taxes. In addition to new filings being required, there will also be registrations for the filings, and additional audit activity. Companies may also find their software systems require modifications to keep up with the new information that will be needed. Companies need to be prepared to address these needs.
Gary Bingel:I think probably the most significant one is that states are now going to be emboldened to apply it to other types of taxes. Although Wayfair itself was a sales tax case, it was not explicitly limited to sales taxes. And I think that states are now going to start to seek to apply it to other types of taxes, like income tax and net worth tax. So I think companies need to be prepared for that. Companies also will likely have to make significant investments in additional resources. Either additional people to deal with the increased compliance and, or increased investments in their IT systems to make sure they're getting the information they need for the filings.