The U.S. sales tax landscape has undergone significant changes in recent years, especially for remote sellers. Thanks to the South Dakota v. Wayfair decision, states now have the authority to collect sales tax from sellers who do not have a physical presence in the state but meet certain economic nexus thresholds. As e-commerce continues to grow, understanding the remote seller requirements in various states is crucial for compliance. In this blog, we’ll explore the sales tax obligations for remote sellers in Colorado and Arizona, two states with unique requirements.
Colorado’s Remote Seller Requirements
Colorado has some of the most stringent sales tax laws in the country, and remote sellers must comply with the state’s nexus rules to avoid penalties. The state enacted economic nexus rules following the Wayfair decision, which means remote sellers that exceed certain sales thresholds are required to collect and remit sales tax to the state.
Economic Nexus Threshold in Colorado
As of 2025, Colorado requires remote sellers to collect sales tax if they meet the following thresholds:
- Annual gross sales exceeding $100,000 in Colorado, or
- 200 or more separate transactions in the state during the calendar year.
If a seller exceeds either of these thresholds, they are considered to have economic nexus in Colorado and must register for sales tax collection with the Colorado Department of Revenue. Once registered, remote sellers are required to collect sales tax on sales made to Colorado customers.
Filing and Remitting Sales Tax in Colorado
Once a remote seller is registered for sales tax in Colorado, they must file sales tax returns regularly. The frequency of filing depends on the amount of tax liability:
- Monthly: For sellers who collect more than $500 in sales tax per month.
- Quarterly: For sellers who collect between $100 and $500 in sales tax per month.
- Annually: For sellers who collect less than $100 in sales tax per month.
Sales tax returns are typically due by the 20th of the month following the reporting period. Remote sellers must submit their returns and make the necessary payments electronically using Colorado’s online tax portal, Revenue Online.
Sales Tax on Delivery and Shipping Charges
In Colorado, sales tax applies not only to the sale of tangible personal property but also to certain services. When it comes to shipping charges, Colorado has specific rules about whether shipping is taxable. If the seller is charging a separate fee for shipping, the shipping charges are taxable unless the seller can prove that the shipping was included as part of the sale price.
In some cases, shipping charges may be exempt if the item is delivered outside of Colorado or if the seller uses a third-party fulfillment service.
Arizona’s Remote Seller Requirements
Like Colorado, Arizona also enforces economic nexus for remote sellers. The state has set clear thresholds for remote sellers, which makes it easier for businesses to determine their tax obligations. Arizona offers one of the more streamlined systems for sales tax collection and reporting, but sellers still need to ensure they are fully compliant to avoid fines and penalties.
Economic Nexus Threshold in Arizona
As of 2025, Arizona requires remote sellers to collect and remit sales tax if they meet the following thresholds:
- Annual gross sales exceeding $100,000 in Arizona.
This threshold is simpler than Colorado’s, as it only requires remote sellers to meet the $100,000 sales threshold without additional transaction limits. Once this threshold is exceeded, remote sellers are required to register with the Arizona Department of Revenue (ADOR) and collect sales tax on sales made to Arizona customers.
Filing and Remitting Sales Tax in Arizona
Once registered, remote sellers must file regular sales tax returns in Arizona. The filing frequency depends on the amount of sales tax collected during the year:
- Monthly: For sellers who collect more than $500 in sales tax per month.
- Quarterly: For sellers who collect between $100 and $500 in sales tax per month.
- Annually: For sellers who collect less than $100 in sales tax per month.
Sales tax returns in Arizona are generally due on the 20th of the month following the end of the reporting period. Sellers can file and pay their sales tax online through the ADOR’s Transaction Privilege Tax (TPT) online portal.
Sales Tax on Delivery and Shipping Charges in Arizona
In Arizona, the treatment of shipping charges is similar to Colorado. If shipping charges are separately stated on the invoice and are part of the sale of tangible personal property, they are generally taxable. However, if the charges are specifically for the delivery of an exempt item, they may be excluded from tax.
As with Colorado, remote sellers should ensure that they have clear documentation and policies in place regarding how shipping charges are billed to avoid any issues during audits or compliance checks.
How PEAK Business Consultancy Services Can Help with Sales Tax Compliance
At PEAK Business Consultancy Services, we specialize in helping remote sellers navigate the complexities of state sales tax compliance, particularly in states like Colorado and Arizona. Our experienced offshore team can assist with sales tax registration, filing, remittance, and ongoing compliance for e-commerce businesses operating in multiple states.
Here’s how we can help:
- Sales Tax Registration: We assist in determining where your business has nexus and handle the registration process in the applicable states.
- Sales Tax Filing and Remittance: Our team ensures that your sales tax returns are filed on time and that payments are made accurately through each state’s online portal.
- Tax Rate Calculation: We use sophisticated tax software to calculate the correct sales tax rates based on the location of your customers and the products being sold.
- Ongoing Compliance Support: As tax laws change, we keep track of any modifications to sales tax rules and ensure your business stays compliant with new requirements.
- Audit Support: In the event of a state audit, we provide full support to help you address any issues and defend your sales tax filings.
With PEAK’s comprehensive tax compliance services, remote sellers can focus on growing their business without worrying about the complexities of sales tax regulations. Our team helps streamline your sales tax processes, ensuring compliance while reducing the risk of penalties and audits.
Get Started Today
If your business is operating in Colorado, Arizona, or any other state, it’s essential to stay ahead of the ever-changing sales tax requirements. PEAK Business Consultancy Services is here to help you navigate the complexities of multi-state sales tax compliance and ensure that you meet all your obligations.
Ready to get started? Contact us today to learn more about how we can assist you with sales tax compliance for your remote sales in Colorado, Arizona, and other states.
PEAK Business Consultancy Services — your trusted partner for multi-state sales tax compliance and e-commerce tax solutions.
