The place to find business sales tax information

— as well as solutions, services and jobs!

My client drives to trade shows or "events" and sells on the spot. Does that create nexus?

Full Question: Hi Diane, I have a client who has an office in CA. It sells/distributes high-end motorcycle helmets. The helmets are stored and shipped from IL to either the end user or the distributor. They also have a van they drive in in various states. I.e. they were in NH in the van at a motorcycle event. They took orders for motor helmets to people at the event and they were paid for on a credit card on the spot in NH. The order is called in or e-mailed to the CA office. The helmet is shipped from the IL inventory warehouse to whatever state the purchaser lives in. There is no sales tax in New Hampshire, so is the transaction a sales taxable event in any other state? Or is the purchaser responsible for use tax in their home state? What if they were in a state that has sales tax, then what? I am not sure driving around in a van and selling creates nexus or does it?

Brought to you by:

NOTE: This site does NOT provide client-specific tax advice. Information provided is general and may NOT apply to your particular situation. Do NOT take any action based upon any site content until you have received advice from an independent, qualified tax practitioner with whom you have a professional-client relationship. All content is subject to our disclaimer.


Diane Yetter photoTo answer your question, the specific transaction that you asked about for NH will not have any NH sales tax issue as they do not impose a sales tax. However, if someone ordered a helmet at the event in NH and had it shipped to a state where you otherwise have nexus, then you would have an obligation to collect sales tax for the ship to state. If you don't have nexus in the ship to state, then the customer has the use tax obligation. Whether or not the activity you are doing in driving into states and operating a "booth" where you take orders and accept payment, this likely does create nexus - not just for sales tax but also potentially for income tax. In state sales solicitation is a nexus creating activity. The question is then whether or not it is considered substantial under the state rules. Some states may consider your activity to be like a "trade show" and if they have a safe harbor rule for trade show booth participation, then you may qualify if the number of days per year does not exceed the threshold. However, most of those safe harbor rules require the that order is not accepted at the show. Given that you are accepting payment and charging the credit card at the event, this might violate the exception. This is also what might create income tax nexus. Solicitation activities are protected under PL 86-272 but requires that the orders are accepted outside the state and inventory is shipped from outside the state. You meet the inventory rule but I don't think you are meeting the order acceptance rule. I hope this helps. If you or your client would like our assistance in further evaluation of your situation, we do provide sales tax consulting services and would be happy to talk with you about our services.

(Not quite what you need? View SALES TAX QUESTIONS home page to access other topics or use site-wide SEARCH in upper right)


Access to any portion of is contingent upon your acceptance of our Terms of Use. This Web Site and content provided by STS Publishing, LLC and its third party content providers, including, but not limited to information, documents, forms, comments, advice and opinions, is for informational purposes only, and is not a substitute for professional advice, nor does the use of this Web Site constitute a professional-client relationship. The Web-Site also includes advertisements, directory listings, job postings and links to third party web sites, all of which are provided for your convenience only and in no way constitute a referral, endorsement, or warranty by of any product or service provided by such third parties. All content is provided “as is” with no guarantee regarding accuracy, suitability, or timeliness. Your reliance on any content accessed on or through the Web Site, or on any product or service provider is strictly at your own risk.