Q:  What is "nexus"?

A:  Nexus means that a company has enough connection to the state that the state can impose a duty to collect sales taxes for that state. The concept of nexus is the same as the concept of "doing business in".

"Substantial nexus" exists if a taxpayer is present within a state. Companies that maintain offices or employees in a state will be subject to that state's income tax on revenues earned in that state. Companies that regularly send employees or agents into a state to service customers will likely be taxable in that state. Companies that own property in a state will likely be subject to that state's income tax. All of these companies are likely to have nexus for taxation.

If you maintain offices or employees in a state, regularly send employees or agents into a state or own property in a state you most likely have "nexus" with that state.

Q:  How is the location of an address determined to be within a taxing authority jurisdiction?

A:  esalestax.com uses the designated point of delivery address provided by the purchaser to derive a zip code +4 location. The location is assigned a geographical code to resolve the placement of an address within the boundaries of state, county, local and special taxing authorities jurisdiction.

Q:  How are product codes determined to be exempt from tax collection within a taxing authority jurisdiction?

A:  esalestax.com uses the services of CCH/DPC to determine what products are tax exempt within the boundaries of state, county, local and special taxing authority's jurisdiction. The accuracy of the process is dependent upon the taxing authorities publishing error free jurisdictional product exemption data.

Q:  How much time will esalestax.com's approach to Sales and Use Tax calculation add to an Internet Transaction? How will esalestax.com's solution minimize the impact?

A: The exact amount of time that it takes to perform the various functions to authenticate the eMerchant, validate the transaction, determine Nexus, determine taxability of each line item, calculate the applicable tax(es) and formulate the response can be done in sub-second time.

Q: Can Business-to-Business and other Internet sales transactions not involving a Credit Card for payment be processed?

A:  Yes. The esalestax.com approach is independant of the payment method selected by the business.

Q: Will the financial institutions, credit card companies or other institutions be adversely affected by collecting sale and use taxation?

A: No, not by the esalestax.com solution. esalestax.com will make use of the NACHA based ACH Debit and Credit transaction facilities to access the Sales and Use Tax amounts calculated on a Sale, Return and Loss transactions performed by a client eMerchant. All of this activity will be consolidated to minimize the account transaction volume and to simplify auditing. Amount due to Tax Authorities will also be consolidated. Auditing to identify what eMerchants and what sales, returns and losses are accounted for in a settlement will be provided via the esalestax.com web site, via electronic reporting and if need be, paper reports. eslaestax.com will use neither the Credit Card issuers nor their merchant or issuing banks systems, resources or processes to perform Sales and Use Tax calculations and/or payments to Tax Authorities.