📅 2026 Update: Sales Tax Changes You Should Know

Sales tax laws and rates can change quickly. Since the original article was published, there have been several important updates related to sales tax across the United States. This section highlights those changes that matter most for understanding sales tax today.

The earlier article continues further down the page, providing foundational information.

🆕 📊 North Carolina Tax Changes

On July 1, 2026, North Carolina introduced a new sales and use tax rate structure. Businesses operating in the state must register for a sales and use tax permit under this new system. It's crucial for businesses to stay updated on these changes to avoid compliance issues.

  • 📅 Deadline Reminder: Sales and use tax returns in North Carolina are due on the 20th day of the month after each reporting period.

🔄 📉 Ohio Rate Reduction

On October 1, 2025, Brown County, Ohio, reduced its sales and use tax rate from 7.25% to 7.00%. This change is significant for businesses in the area, as it may affect their sales tax calculations and filings.

  • 📅 Filing Deadline: Businesses in Ohio need to file their sales and use tax returns by the 23rd day of the month following the end of the reporting period.

💰 📊 Current Sales Tax Rates

As of October 2026, state sales tax rates range from 2.9% in Colorado to 7.25% in California. The combined state and local rates can be even higher, with Louisiana at 10.13%, Tennessee at 9.61%, and Washington at 9.57%.

🏢 📜 Business Registration Requirements

In North Carolina, all businesses making sales of tangible personal property, digital property, or taxable services must register for a sales and use tax permit. Similarly, Ohio requires businesses selling tangible personal property or taxable services to register as well. Understanding these requirements is essential for compliance.

📌 Key Updates Summary

  • 🆕 North Carolina has a new sales and use tax rate structure as of July 1, 2026.
  • 📉 Brown County, Ohio, lowered its sales tax rate to 7.00% effective October 1, 2025.
  • 💰 State sales tax rates now range from 2.9% to 7.25%.
  • 🏢 Businesses must register for sales tax permits in both North Carolina and Ohio.
  • 📅 Be aware of filing deadlines: 20th for North Carolina, 23rd for Ohio.

💡 Tips for Sales Tax Compliance

Reviewing your situation with an attorney is important to ensure you meet all legal requirements.

📝 📅 Know Your Filing Deadlines

In North Carolina, remember that sales tax returns are due on the 20th of the month after the reporting period. Ohio businesses must file by the 23rd. Keeping track of these deadlines can help you avoid penalties.

🏢 📜 Register for Sales Tax Permits

If you operate a business in North Carolina or Ohio, ensure you register for a sales and use tax permit. This registration is essential for compliance and helps avoid fines.

💰 📊 Stay Updated on Rate Changes

Sales tax rates can change frequently. Regularly check your state’s tax authority website to stay informed about any updates or changes in rates.

🛍️ 📦 Understand Exemptions

Certain items may be exempt from sales tax, such as specific goods in North Carolina. Familiarize yourself with what is exempt in your state to ensure accurate pricing and compliance.

👩‍💼 🆓 Utilize Free Resources

Both the North Carolina Department of Revenue and the Ohio Department of Taxation offer free resources to assist businesses. Take advantage of these tools to help you understand and comply with sales tax laws.

📞 🛠️ Seek Assistance When Needed

If you're unsure about your sales tax obligations, don’t hesitate to seek help. Consulting with state tax authorities or using available resources can provide clarity on compliance and filing.

🏆 Sales Tax Services Ranked by User Reviews (2026)

This section lists services related to tax preparation and filing, relevant for anyone needing assistance with sales tax compliance. The order follows Trustpilot data checked in October 2026, and scores can change over time. Star ratings reflect user experiences, but keep in mind that unhappy customers often leave more feedback, which can affect averages.

🥇 1. H&R Block

H&R Block holds a Trustpilot score of 4.2. It is known for its comprehensive tax preparation services and online tax filing options. However, some users note high fees for in-person services and mention concerns about customer service responsiveness.

🥈 2. TurboTax

TurboTax has a Trustpilot score of 4.0. It is recognized for its user-friendly online tax filing software. Some reviewers point out that the free version is limited and that there is upselling of additional services, which can be a drawback for users.

🥉 3. TaxSlayer

TaxSlayer averages a Trustpilot score of 3.8. It is known for offering affordable tax filing options and multiple filing methods. Users have mentioned limitations in customer support and occasional software glitches, which may affect the filing experience.

4️⃣ Jackson Hewitt

Jackson Hewitt has a Trustpilot score of 3.5. It offers in-person tax preparation services and year-round support. However, some customers report higher service fees and inconsistent service quality across different locations.

5️⃣ Liberty Tax Service

Liberty Tax Service holds a Trustpilot score of 3.2. It is known for its franchise tax preparation and seasonal promotions. Reviewers have noted variable service quality and aggressive marketing tactics, which could impact customer satisfaction.

🆓 Free Government Resources

Both North Carolina and Ohio provide free resources for businesses regarding sales and use tax. The North Carolina Department of Revenue and the Ohio Department of Taxation offer assistance and guidance to help businesses navigate their tax obligations.

🔎 Choosing the Right Tax Service

  • 🏆 Compare Trustpilot scores to assess user satisfaction.
  • 📅 Check for filing support options that fit your needs.
  • 💼 Look for services that offer personalized assistance.
  • 💰 Consider costs and any potential hidden fees.
  • 🛠️ Ensure the service provides up-to-date information on tax changes.

❓ Frequently Asked Questions

❓ What is the highest sales tax rate in the U.S.?

Louisiana has the highest combined state and local sales tax rate at 10.13% as of October 2026.

📅 Are there penalties for late sales tax filings?

Yes, late filings can result in penalties and interest. It's essential to file returns on time to avoid these additional costs.

🏢 How do I register for a sales tax permit in my state?

Businesses must apply for a sales tax permit through their state's tax authority. Each state has its own registration process, so it's important to check the specific requirements.

💰 What types of items are generally exempt from sales tax?

Sales tax exemptions vary by state. For instance, North Carolina exempts certain items from its general 4.75% state rate. Consult state authorities for specifics.

🔄 How often do sales tax rates change?

Sales tax rates can change frequently due to legislative actions. Regularly reviewing state tax authority updates is recommended to stay informed.

📞 Where can I find help with sales tax questions?

Both North Carolina and Ohio offer resources through their Departments of Revenue and Taxation. These agencies provide assistance for businesses seeking clarification on sales tax issues.

⚖️ Recent Court Rulings on Sales Tax Cases

Recent court rulings have clarified various aspects of sales tax laws, impacting how businesses comply with tax regulations. These rulings influence both state and local sales tax practices.

For more recent rulings, feel free to check more rulings on the news page.

End of October 2026 Update






Understanding the Details of Sales Tax: What You Need to Know
Sales tax is a type of tax levied on the sale of goods or services and is typically calculated as a percentage of the sale price. The tax is collected by the seller and remitted to the appropriate government agency. Each state in the United States sets its own rules and rates for sales tax, making it important for businesses and consumers alike to understand the details of this tax.

What is Sales Tax?

Sales tax is a tax on consumption that is levied by state and local governments in the United States. The tax is based on the price of the goods or services being sold and is collected by the seller at the time of the transaction. The seller then remits the tax to the appropriate government agency.

Understanding the Details of Sales Tax

The sales tax rate varies by state and can range from 0% in some states to over 9% in others. In addition, some local governments also levy a local sales tax, which can increase the overall amount of tax due on a transaction.

Exemptions and Exclusions

While most goods and services are subject to sales tax, there are some exemptions and exclusions that vary by state. For example, many states do not tax food and prescription drugs. Similarly, some states exempt clothing and footwear from sales tax.

However, it is important to note that these exemptions and exclusions can be nuanced and vary by state. For example, some states only exempt certain types of food (such as groceries) or have a dollar amount threshold for exempting clothing purchases.

In addition, some states have exemptions or exclusions for certain types of businesses or transactions. For example, some states exempt purchases made by non-profit organizations or provide an exemption for certain types of manufacturing equipment.

Taxable Nexus

Nexus is the term used to describe the level of connection between a business and a state that would require the business to collect and remit sales tax. The rules regarding nexus vary by state and can be complex.

Generally speaking, a business has nexus in a state if they have a physical presence such as an office or warehouse in that state. However, some states have expanded the definition of nexus to include other factors such as the number of sales or the use of independent contractors within the state.

For businesses that sell goods or services in multiple states, understanding the nexus requirements for each state is critical. Failure to collect and remit sales tax in a state where you have nexus can lead to penalties and interest charges.

📝 See Also

Filing Requirements

Businesses that collect sales tax are typically required to file periodic returns with the appropriate government agency. The frequency of these returns varies by state but is typically either monthly, quarterly, or annually.

The sales tax return typically includes information about the total amount of sales made during the period, the amount of sales tax collected, and any other relevant information such as exemptions or deductions.

Failure to file sales tax returns on time can result in penalties and interest charges, so it is important for businesses to understand their filing requirements and deadlines.

Online Sales Tax

The rise of online shopping has created new challenges for states when it comes to sales tax. Prior to a 2018 Supreme Court ruling, states were limited in their ability to require out-of-state retailers to collect and remit sales tax.

However, the Supreme Court ruling in South Dakota v. Wayfair, Inc. changed the rules by allowing states to require out-of-state retailers to collect and remit sales tax if they have a certain level of sales or transactions within the state.

Since the Wayfair ruling, many states have adopted new rules for online sales tax. Some states have adopted economic nexus thresholds similar to those used for regular sales tax. For example, a state might require out-of-state retailers to collect and remit sales tax if they have more than $100,000 in sales or 200 or more transactions within the state.

Other states have implemented marketplace facilitator laws, which require online marketplaces such as Amazon or Etsy to collect and remit sales tax on behalf of their sellers. This simplifies the process for small businesses that sell on these platforms, but it can also lead to confusion and complexity for larger sellers that operate outside of these marketplaces.

Conclusion

Sales tax is an important revenue source for state and local governments and affects nearly every business and consumer in the United States. Understanding the details of this tax is critical for businesses to ensure compliance and avoid penalties, and for consumers to understand the overall cost of their purchases.

While the rules and rates for sales tax can be complex, there are resources available to help businesses and consumers navigate the system. Each state’s Department of Revenue is responsible for administering sales tax and can provide information on filing requirements, exemptions, and other topics.

In addition, there are a number of online tools and software solutions available to help businesses calculate and report sales tax. By staying informed and taking advantage of available resources, businesses and consumers can navigate the details of sales tax with confidence.

In general, sales taxes are that which accompany the buying and selling of goods. A sales tax is imposed upon aspects related to areas of consumption, to be more specific. Most states impose sales taxes as payment to both state as well as federal government. The responsibility of collecting sales taxes falls upon the shoulders of the merchant or vendor who is selling goods and services. One distinction exists as well, however, that which specifies that "resellers" be exempt to sales taxes as long as they, themselves, did not make use of items up for resale.

In order to guarantee such exemption in some locales, individuals must produce a "reseller's certificate." The federal government also sets forth limitations where states may only impose such tax policies upon their residents as areas of "interstate commerce," for instance are left for the governments determination. In the event of the absence of a sales tax, another cost may be incurred, such as that of a "use tax."

Aside from sales tax associated to general retail, which accompanies the final purchase by the consumer, there exist additional categories of sales taxes. In specific terms, sales taxes may be divided into a number of categories. These include "gross receipts taxes," "excise taxes," the aforementioned "use tax," "value added taxes," "fair tax," and "turnover tax." Gross receipts taxes are that which are imposed upon business sales. This particular sales tax is often met with contention as some believe it is only a basis for multiple taxation practices. Excise taxes are placed upon certain products only, such as gasoline and alcoholic beverages, for instance.

In addition, they are usually imposed upon the initial producer as opposed to the eventual retailer of such items. A use tax is placed on items that possessed no prior sales tax at the time of purchase. Though they do exist in conjunction with regular sales taxes, they may be a hard sell with consumers aside from those involved in larger scale purchases. Value added taxes are that which are imposed upon every single sale while a fair tax is an example of a potential federal sales tax that would take the place of federal income taxes. Turnover tax, then, exhibits taxes imposed as an "indirect tax."

In general sales taxes vary depending upon the state in which you reside. For example sales tax stands at a rate of 7% with a differing amount when concerning areas specified as "urban enterprise zones." These urban business districts may only entail a sales tax rate of 3.5%.

In addition, the state of New Jersey also places various exemptions on various items, such as that of "unprepared foods" aside from some candy and pet foods, as well as on clothing. However, a sales tax does accompany the purchase of clothing produced from animals' "hides or pelts," which are valued to be in the upwards of $500 or more. Sales tax for such a purchase would garner that of a 6% "Fur Clothing Gross Receipts Tax."