RS-6 - Timeline to Start Collecting Tax After Meeting Threshold

If an out-of-state dealer has no physical presence in Tennessee and meets the sales threshold, it is required to register and begin collecting sales and use tax on the first day of the third month following the month in which it meets the threshold. For example, if a dealer meets the threshold on January 15, 2020, the dealer is required to register, collect, and remit sales tax beginning on April 1, 2020, for any sales made on and after April 1, 2020.

The sales threshold was set at $500,000 beginning October 1, 2019. Out-of-state dealers should use $500,000 threshold for periods between October 1, 2019 and September 30, 2020. Out-of-state dealers should use $100,000 threshold beginning October 1, 2020.

Reference: Tenn. Code Ann. § 67-6-524.

Note: This article was updated on December 22, 2021 for clarification purposes. The previous version of RS-6 is available here.


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