State Sales Tax Nexus and General Overview

Need to Understand a State's Sales Tax Situation? Here it is...

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Arizona (AZ)

AZ Sales Tax - Name of Tax and General Application:

Arizona imposes a tax on the privilege of engaging in the business of selling tangible personal property or services in the state. This tax is referred to as a "sales tax". In addition, Arizona imposes a tax on the storage, consumption or use of tangible personal property. This tax is referred to as a "use tax" or an "excise tax".

AZ Nexus - General Requirements:

The word "nexus" means a link or connection. If you are determined to have nexus to a U.S. state then you are subject to that state's sales and use tax rules and must collect and remit sales tax to the state. This is known as a "filing obligation."

Each state has a different definition of nexus. However, if the answer to any of the following questions is yes, it is likely that a company has nexus as legally defined in most U.S. States.

Does the company own property in the state? Does the company have employees living in the state? Does the company regularly send employees in the state to perform services? Does the company have an agent acting on behalf of the company in the state?

In Arizona, a retailer is required to collect and pay sales or use tax when they maintain a place of business in the state, make sales of tangible personal property for storage, use or consumption, or regularly solicit sales by mail in the state.

AZ Local Tax - Do Localities Impose Tax?

Yes, Arizona imposes local sales tax.

AZ Resale Certificate Renewal Agreements:

Arizona does not require a state issued resale certificate. It does require the seller to collect and record enough data to establish the resale intent of the purchaser. This can be done with the use of a state issued certificate, but it is not required.

AZ Resale Certificate Renewal Periods

Arizona does not set a specific time limit for certificates in general, although in regards to blanket certificates the expiration will be designated on the certificate.

AZ Statute of Limitations

The later of four years from the date the return was due or the date the return was filed. If the tax base was understated by more than 25%, the statue of limitations becomes six years from the same dates.