One of the first steps to sales tax compliance in the US is registering for a sales tax permit. Also commonly referred to as a sales tax license, seller permit, or retailer permit, these permits grant businesses the permission to collect sales tax from customers in a particular state.

Collecting sales tax without a permit is illegal, so it’s important not to skip the registration step. Below, we’ll explain how to get a sales tax permit in each state and answer a few common questions regarding sales tax permits.

Below, we cover who needs a sales tax permit, how to register for a sales tax permit in each state, and what happens if you don't register for a sales tax permit when you’re required to have one.

Note that this is general sales tax information, and you should consult an expert for advice specific to your business.

Key takeaways

• You need a permit in every state where you have physical presence (office, employee, inventory) or economic nexus (typically $100,000+ in sales or 200+ transactions).
  
• Under South Dakota v. Wayfair (2018), you do not need physical presence to owe sales tax.
  
• Most state sales tax permits are free to apply for, and processing can take anywhere from a few seconds to several weeks depending on the state.
  
• The Streamlined Sales Tax Registration System (SSTRS) lets you register in 24 states through a single form.
  
• Once registered, you must file returns on schedule (monthly, quarterly, or annually) even with zero sales.
  

Do I need a sales tax permit?

In the US, businesses are required to collect sales tax from customers when they exceed certain thresholds. These thresholds are referred to as economic nexus thresholds, and they are revenue based, transaction based, or both. Because sales tax is governed at the state level, these thresholds vary from state to state.

For example, in Nevada, businesses need to collect sales tax from customers only if they have exceeded $100,000 in revenue or 200 transactions from customers in Nevada. Certain states only have revenue thresholds or require businesses to exceed the revenue and transaction thresholds before collecting sales tax.

Businesses can also meet sales tax obligations by having a physical presence or physical nexus in a state. Examples of business activities that can create physical nexus include:

• Location: An office, warehouse, store, or other physical place of business. Storing inventory often creates physical nexus.

• Employees: Having an employee, contractor, salesperson, installer, or other person doing work for your business in a state.

• Events: Selling products at a tradeshow or other event.

Once you determine you have sales tax obligations in a state, your next step is to register for a sales tax permit. Those permits are specific to each state, so you must register for a permit in each state where you have sales tax obligations. However, there is a streamlined registration process for certain states that we’ll cover later.

Nexus explained

Sales tax nexus is any legal connection between a business and a state that requires the business to collect and remit sales tax on in-state transactions.

Before deciding how to register, determine whether you actually need to. Sales tax obligations are triggered in one of two ways:

• Physical nexus
  Physical nexus occurs when your business has a tangible presence in a state. This can include having an office, warehouse, or retail location in a state, storing inventory in that state, having employees or contractors working in that state, or using a fulfillment or drop-shipping partner physically located in that state.

• Economic nexus
  Economic nexus is triggered by sales revenue or transaction volume, regardless of physical presence. Following the 2018 South Dakota v. Wayfair, Inc. Supreme Court decision, all 45 states with a statewide sales tax enforce economic nexus regulations. While the standard baseline is $100,000 in sales or 200 transactions annually, thresholds vary by state.

Under marketplace facilitator laws, marketplaces like Amazon, Etsy, and Uber Eats are required to collect and remit sales tax on behalf of their sellers. If you only sell in a state via marketplace, you may not need to register at all. Rules vary by state, so verify with each state where you have nexus.

Sales tax permit registration: State-by-state comparison

What documents do you need to register?

Requirements vary slightly by state, but having these documents prepared in advance will streamline the application process:

• General business information: Legal names of owners and percentages of ownership, government-issued ID number, and the location of the primary corporate headquarters and any local physical locations (such as warehouses or retail stores).

• Tax identifier: You will need your Employer Identification Number (EIN), social security number, and any existing state tax ID.

• Legal entity details: Official registered business name or trade name, as well as your business entity type (LLC, sole proprietorship, etc.).

• NAICS code: Your North American Industry Classification System (NAICS) code describing your primary business activity.

• Sales tax information: You will need the exact date your business gained sales tax nexus, an estimate of monthly or annual taxable sales in the state, and a summary of the goods or services you sell.

Additionally, depending on the state, you may need a business checking account for direct debit of future tax remittances.

How long does sales tax permit registration take?

Processing times vary widely by state and application method, ranging from immediate approval to several weeks.

• Online applications (Instant to 10 business days)
  Many states process digital submissions within 1 to 5 business days, with several issuing an account number and electronic permit immediately.

• Paper or mail applications (2 to 6 weeks)
  Filing by mail or submitting applications that require manual review takes significantly longer.

• Streamlined Sales Tax (SSTRS)
  Submitting a multistate registration through the SSTRS typically processes across participating states within a few business days.

Best practice is to apply 2 to 4 weeks before you begin making taxable sales or anticipate crossing a state’s economic nexus threshold. States do not permit you to collect sales tax from customers until your registration is officially active.

How much does registration cost?

In most US states, registering for a sales tax permit is free. However, total costs depend on state-specific application fees, security bond requirements, and whether you register directly or through a multistate system.

While the majority of states issue permits at no charge, several require a one-time registration or licensing fee:

• Arizona: $12, charged per business location. Local municipalities may charge additional registration fees.

• Arkansas: $50, a nonrefundable one-time fee.

• Colorado: $16, accompanied by a mandatory $50 refundable security deposit (totaling $66 upfront). The license must be renewed every two years.

• Connecticut: $100, which covers a permit that automatically renews every two years at no extra cost.

• Florida: $5 (paper applications only). Registering online is free.

• Hawaii: $20, a one-time fee for a General Excise Tax (GET) license, which Hawaii assesses in place of a traditional sales tax.

• Indiana: $25, a one-time fee for a Registered Retail Merchant Certificate (RRMC). It is valid for two years and renews automatically for free if the business is in good standing.

• Nevada: $15, charged per location. A security deposit may also be required depending on your estimated monthly taxable sales volume.

• Ohio: $50, for a standard County or Transient Vendor's License. Note: Out-of-state remote sellers generally register for a free seller's use tax account rather than a standard in-state vendor's license.

• Oklahoma: $20, plus an additional $10 for every extra business location.

• Rhode Island: $10, which must be renewed annually.

• South Carolina: $50, a one-time fee for a standard retail license.

• Wisconsin: $20, which applies to your first tax permit. Additional locations or permits do not require an extra fee.

• Wyoming: $60, a one-time registration fee.

Even in states where the permit itself is technically free (such as California, Texas, and Missouri), the state’s revenue department may require you to post a security deposit or bond based on your projected sales volume or prior credit history before issuing the permit.

It’s worth noting that submitting a multistate registration through the Streamlined Sales Tax Registration System (SSTRS) is free.

Do I have to renew my sales tax permit?

A few states require businesses to renew their sales tax permit periodically. Although certain states require businesses to take action to renew their permit, other states renew it automatically. It’s important to check with your state to determine the renewal process.

These states require businesses to renew their sales tax permit: 

• Alabama: Taxpayers are required to renew their Alabama tax permit annually. 

• Arizona: The state’s transaction privilege tax (Arizona’s version of sales tax) permit must be renewed every year by January 1. 

• Colorado: Colorado sales tax permits must be renewed every two years.

• Connecticut: Connecticut sales tax permits must be renewed every two years.

• Indiana: Indiana automatically renews sales tax permits every two years.

• Louisiana: Expiration time frames vary for each business, but the business must renew its permit within 30 days of the expiration date.

• Michigan: Michigan automatically renews sales tax permits. 

• New York: New York notifies businesses when they have been “selected for renewal.”

• Oklahoma: Oklahoma sales tax permits are issued on a probationary basis for six months and will be automatically renewed for 30 months. It is then renewable in three-year increments as long as the business’s account remains in good standing.

• Pennsylvania: Sales tax permits must be renewed no less than every five years.

• Rhode Island: Sales tax permits are valid for one year and must be renewed every July.

• Washington: Expiration time frames vary for each business, but the business must renew within 90 days of the expiration date.

There are a few scenarios when you should consider updating your sales tax permit:

• Business structure changes: For example, changing your business from a sole proprietorship to a limited liability company (LLC).

• Business ownership changes: For example, if a partner leaves the business or the business is sold.

• Business location changes: For example, if your business’s home state changes. Even if you are an ecommerce business, if you move your “business location” to another state, you should update your sales tax permit accordingly. 

How to register for a sales tax permit in each state

Typically, these are the steps to register with a state to collect sales tax:

Step 1: Determine where you have nexus

Identify every state where you have a legal obligation to collect sales tax. This is triggered by physical presence (having an office, employees, or stored inventory in a state) or economic nexus (exceeding a state's specific revenue or transaction thresholds).

Step 2: Check which states are covered by marketplace facilitators

If you sell exclusively through platforms like Amazon, Etsy, or Walmart, those marketplaces are typically legally required to collect and remit sales tax on your behalf. You may not need your own permit in states where you only have marketplace sales.

Step 3: Choose your registration path

Decide whether to register directly with individual state revenue departments or use the SSTRS portal, which allows you to register in up to 24 participating states using a single application.

Step 4: Gather required documents

Compile your business details in advance. You will need your Federal Employer Identification Number (EIN), corporate structure details, NAICS code, ownership information (including SSNs for primary officers), and banking details for paying fees or remitting taxes.

Step 5: Apply online through the state's Department of Revenue portal

Create an online account on the state's tax website, locate the sales tax permit application (sometimes called a seller’s permit, vendor’s license, or transaction privilege tax), and complete the form. Pay any required state registration fees at checkout.

Step 6: Wait for your permit or resale/reseller certificate

Processing times range from instant approval to a few weeks. Once approved, the state will issue your sales tax ID number and official permit. Note that some states require you to physically display this permit at your retail locations.

Step 7: Set up ongoing tax compliance

Update your checkout or point-of-sale system with your new tax ID to begin collecting tax. The state will assign you a filing frequency–usually monthly, quarterly, or annually. You must file returns on time going forward, even for periods where you had zero sales.

One option for streamlining this process is to let Stripe manage your tax registrations in the US. This allows you to benefit from a simplified process that prefills application details, saving you time and ensuring compliance with local regulations.

If you met the tax registration requirement in a state but did not register, you have a few options. If months have passed since you exceeded the tax registration requirement, consult sales tax experts to determine the best way forward for your business. Most states have a voluntary disclosure program to help sellers resolve sales tax liabilities, and you might be eligible to participate in a state’s amnesty program to come into compliance. Do not begin collecting tax until you have properly registered with the state or local tax authority.

What happens after registration?

Once your state revenue department approves your application and issues your sales tax permit, you must immediately begin complying with local tax regulations.

This includes collecting sales tax in your ecommerce platform, billing software, or point-of-sale system. You will also need to remit sales taxes back to the state at your assigned filing frequency (monthly, quarterly, or annually). 

While many permits are valid indefinitely, some states require annual or biennial renewals.

What happens if you don’t register for a sales tax permit?

Failing to register for a permit when you have nexus, or collecting tax without one, carries severe financial and legal consequences:

• Paying back taxes out of pocket: If you fail to register and do not collect sales tax from buyers, the state still holds you liable. During an audit, you will be forced to pay uncollected historical taxes out of your own revenue.

• Aggressive penalties and interest: States levy steep penalties for noncompliance. Operating without a permit can trigger penalties up to 50% of the taxes owed, plus daily accruing interest on late payments.

• Legal consequences for unauthorized collection: Collecting sales tax from customers without a valid permit is illegal. Tax authorities view this as fraud, which can result in misdemeanor charges, significant fines, or criminal prosecution.

• Business disruption: Revenue departments can revoke your general business licenses, place liens on your assets, or legally force you to cease operations until your tax obligations are resolved.

How Stripe Tax can help

Stripe Tax reduces the complexity of tax compliance so you can focus on growing your business. Start collecting taxes globally by adding a single line of code to your existing integration, clicking a button in the Dashboard, or using our powerful API.

Stripe Tax helps you monitor your obligations and alerts you when you exceed a tax registration threshold based on your Stripe transactions. It can also register to collect tax on your behalf in the US, automate US filings in the Dashboard, and manage global filings through trusted partners. Stripe Tax automatically calculates and collects sales tax, VAT, and GST on:

• Digital goods and services in all US states and over 100 countries
  
• Physical goods in all US states and 42 countries
  

Stripe Tax can help you:

• Understand where to register and collect taxes: See where you need to collect taxes based on your Stripe transactions. After you register, switch on tax collection in a new state or country in seconds. You can start collecting taxes by adding one line of code to your existing Stripe integration, or add tax collection with the click of a button in the Stripe Dashboard.

• Register to pay tax: If you need to register for a sales tax in the US, let Stripe manage your tax registrations. You’ll benefit from a simplified process that prefills application details—saving you time and simplifying compliance with local regulations. If you need help registering outside of the US, Stripe partners with Taxually to help you register with local tax authorities.

• Automatically collect tax: Stripe Tax calculates and collects the right amount of tax owed, no matter what or where you sell. It supports hundreds of products and services and is up-to-date on tax rules and rate changes.

• Simplify filing: Stripe Tax automates US filings in the Dashboard, powered by TaxJar. For global filings, Stripe Tax seamlessly integrates with filing partners, so your global filings are accurate and timely. Let our partners manage your filings so you can focus on growing your business. 

Learn more about Stripe Tax, or get started today.

FAQs about sales tax permit registration