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SESK: Stuff Everyone Should Know · sesk.info/biz-wayfair-physical-presence

What sales-tax rule did the Supreme Court reject in Wayfair?

The Court rejected the old physical-presence-only rule.

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  1. A seller must be physically present ✔
  2. Every online sale is tax-free
  3. Only federal tax applies online

Why: In 2018, Wayfair removed the constitutional rule that generally required physical presence before a state could impose collection duties. A sufficient connection, including economic nexus, can now matter.

Huh, didn't know that: The case was South Dakota v. Wayfair, Inc., decided June 21, 2018.

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Why did the online store study geography? Its sales had state connections.
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References

Answer: A seller must be physically present. In 2018, Wayfair removed the constitutional rule that generally required physical presence before a state could impose collection duties. A sufficient connection, including economic nexus, can now matter.

  1. Supreme Court, South Dakota v. Wayfair www.supremecourt.gov/opinions/17pdf/585us1r58_pok0.pdf
    the physical presence rule of Quill is unsound and incorrect
    Checked 2026-10-11.

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