Every retailer engaged in business in California and making sales of tangible personal property for storage, use, or other consumption in California, not otherwise exempted, must collect sales or use tax from the purchaser. Generally, "retailer engaged in business in this state" includes any retailer:
- in any way maintaining, occupying, or using, an office or other place of business in California;
- having any qualifying representative operating in California under the authority of the retailer or its subsidiary for the purpose of selling, delivering, installing, assembling, or the taking of orders for any tangible personal property; and
- deriving rentals from a lease of tangible personal property situated in California.
Based on the information provided by you, if you had nonresident employees (or agents) entering the State to generate sales, you have technically created nexus in the State for sales/use tax purposes. This can be somewhat grey if the presence in California was on a limited basis, but technically the statute reflects that any presence would trigger nexus. At this time, I don't think the telecommuting issue impacts your situation. This all comes down to whether or not someone physically entered the state to solicit sales.