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NH based bakery delivers product to ME and MA customers, both retail and wholesale. Are we required to collect sales tax for deliveries in those states?

Full Question: NH based bakery delivers product to Maine and Massachusetts customers, both retail and wholesale. Are we required to collect sales tax for those deliveries in those states?

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Answer:

Diane Yetter photoThe determination as to whether you are required to collect sales tax on sales that you deliver into other states depends on whether you have established nexus in the state of delivery and then whether the products or services you sell are subject to sales tax in that state. If you are based in New Hampshire and sell to customers located in Maine and Massachusetts, and you provide delivery to these customers, it is likely you have established nexus in these states. However, if you delivery is via common carrier rather than your own vehicles, then nexus probably is not established. Assuming you have established nexus, you then need to determine if the transactions are subject to sales tax. Any sales at wholesale should qualify for the resale exemption as long as you have received a valid resale exemption certificate from the customer for the state of delivery. For the sales at retail, both Maine and Massachusetts offer exemptions for groceries. If your products meet the definition of groceries in each state, then the retail sales would not be subject to sales tax. We would be happy to help you determine if you have nexus in Maine and Massachusetts and if your products meet the definition of groceries..

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