Tax
Nexus (Sales Tax)
Quick definition
The connection with a state that triggers a tax-collection obligation.
Post-Wayfair (2018), states can require remote sellers to collect sales tax once 'economic nexus' thresholds are met — typically $100K–$500K of sales or 200+ transactions per year. Most SaaS and e-commerce startups have nexus in many states within a year of material growth.
Related tax terms
R&D Tax Credit
Federal credit for qualified research expenses, usable against payroll tax by startups.
Delaware Franchise Tax
Annual tax for Delaware corporations, often quoted wildly too high if calculated incorrectly.
QSBS (Qualified Small Business Stock)
Tax exemption for gains on qualifying startup stock held 5+ years.
Section 83(b) Election
Tax election for restricted stock holders to be taxed on grant-date value instead of vesting value.
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