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We sell invitations and periodically have clients outside Texas. For example; we have a client in NM. Do we charge sales tax?

Full Question: We sell invitations and periodically have clients outside Texas. For example, we have a client in New Mexico, do we charge her sales tax or not?

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Answer:

Diane Yetter photoSales tax is required to be collected by a retailer who has a substantial presence in the purchasing customer's state. This presence in a state is referred to as nexus. Nexus can be established through the temporary or permanent activities of people or property in-state. This can include your employees, agents acting on your behalf, and the activities of affiliates. If you have created nexus in New Mexico, you may be required to collect tax on taxable sales into the state. If you don't have the required presence in New Mexico, then you should not collect sales tax on the sales. Rather, your customer will have the obligation to remit use tax on the purchase.

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