New Emergency Regulations in Maryland Effective October 1st

On August 29, 2018, the Maryland General Assembly’s Joint Committee on Administrative, Executive, and Legislative Review has approved emergency regulations in support of Maryland’s implementation of the Wayfair decision. Effective October 1, 2018, out-of-state vendors must uphold records to determine whether they will be required to remit Maryland sales tax on retail sales for delivery into Maryland.

On June 21, 2018, the United State Supreme Court ruled in South Dakota v. Wayfair that retailers can be required to collect sales taxes in states where the retailers do not have physical presence, thus overruling the Court’s prior decision in Quill v. North Dakota.

Maryland regulations did not contain an economic nexus standard-upholding only a physical presence standard. Therefore, remote vendors have sufficient economic nexus and, must collect Maryland sales tax for their deliveries in Maryland if, during the previous or current calendar year, they have either (1) more than $100,000 (gross) in property or service sales delivered in Maryland, or (2) at least 200 separate sales transactions into Maryland.

The emergency regulations are effective October 1, 2018, and expire on March 30, 2019. If you need further assistance with this matter or other related tax matters, please contact your KatzAbosch representative.


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