Nexus; out-of-state vendors; obligation to collect tax
Sec. 10. (a) A person that:
(1) makes retail transactions from outside Indiana to a
destination in Indiana;
(2) does not maintain a place of business in Indiana; and
(3) either:
(A) engages in the regular or systematic soliciting of retail
transactions from potential customers in Indiana;
(B) enters into a contract to provide property or services to
an agency (as defined in IC 4-13-2-1) or a state educational
institution (as defined in IC 20-12-0.5-1);
(C) agrees to sell property or services to an agency (as
defined in IC 4-13-2-1) or a state educational institution (as
defined in IC 20-12-0.5-1); or
(D) is closely related to another person that maintains a
place of business in Indiana or is described in clause (A),
(B), or (C);
shall file an application for a retail merchant's certificate under this
chapter and collect and remit tax as provided in this article. Conduct
described in subdivision (3)(B) and (3)(C) occurring after June 30,
2003, constitutes consent to be treated under this article as if the
person has a place of business in Indiana or is engaging in conduct
described in subdivision (3)(A), including the provisions of this
article that require a person to collect and remit tax under this article.
(b) A person is rebuttably presumed to be engaging in the regular
or systematic soliciting of retail transactions from potential
customers in Indiana if the person does any of the following:
(1) Distributes catalogs, periodicals, advertising flyers, or other
written solicitations of business to potential customers in
Indiana, regardless of whether the distribution is by mail or
otherwise and without regard to the place from which the
distribution originated or in which the materials were prepared.
(2) Displays advertisements on billboards or displays other
outdoor advertisements in Indiana.
(3) Advertises in newspapers published in Indiana.
(4) Advertises in trade journals or other periodicals that
circulate primarily in Indiana.
(5) Advertises in Indiana editions of a national or regional
publication or a limited regional edition in which Indiana is
included as part of a broader regional or national publication if
the advertisements are not placed in other geographically
defined editions of the same issue of the same publication.
(6) Advertises in editions of regional or national publications
that are not by the contents of the editions geographically
targeted to Indiana but that are sold over the counter in Indiana
or by subscription to Indiana residents.
(7) Broadcasts on a radio or television station located in
Indiana.
(8) Makes any other solicitation by telegraphy, telephone,
computer data base, cable, optic, microwave, or other
communication system.
(c) A person not maintaining a place of business in Indiana is
considered to be engaged in the regular or systematic soliciting of
retail transactions from potential customers in Indiana if the person
engages in any of the activities described in subsection (b) and:
(1) makes at least one hundred (100) retail transactions from
outside Indiana to destinations in Indiana during a period of
twelve (12) consecutive months; or
(2) makes at least ten (10) retail transactions totaling more than
one hundred thousand dollars ($100,000) from outside Indiana
to destinations in Indiana during a period of twelve (12)
consecutive months.
(d) Subject to subsection (e), the location in or outside Indiana of
vendors that:
(1) are independent of a person that is soliciting customers in
Indiana; and
(2) provide products or services to the person in connection
with the person's solicitation of customers in Indiana:
(A) including products and services such as creation of copy,
printing, distribution, and recording; but
(B) excluding:
(i) delivery of goods;
(ii) billing or invoicing for the sale of goods;
(iii) providing repairs of goods;
(iv) assembling or setting up goods for use by the
purchaser; or
(v) accepting returns of unwanted or damaged goods;
is not to be taken into account in the determination of whether the
person is required to collect use tax under this section.
(e) Subsection (d) does not apply if the person soliciting orders is
closely related to the vendor.
(f) For purposes of subsections (a) and (e), a person is closely
related to another person if:
(1) the two (2) persons:
(A) use an identical or a substantially similar name,
trademark, or good will to develop, promote, or maintain
sales;
(B) pay for each other's services in whole or in part
contingent on the volume or value of sales; or
(C) share a common business plan or substantially
coordinate their business plans; and
(2) either:
(A) one (1) or both of the persons are corporations and:
(i) one (1) person; and
(ii) any other person related to the person in a manner that
would require an attribution of stock from the corporation
to the person or from the person to the corporation under
the attribution rules of Section 318 of the Internal Revenue
Code;
own directly, indirectly, beneficially, or constructively at
least fifty percent (50%) of the value of the corporation's
outstanding stock;
(B) both entities are corporations and an individual
stockholder and the members of the stockholder's family (as
defined in Section 318 of the Internal Revenue Code) own
directly, indirectly, beneficially, or constructively a total of
at least fifty percent (50%) of the value of both entities'
outstanding stock; or
(C) one (1) or both persons are limited liability companies,
partnerships, limited liability partnerships, estates, or trusts,
and their members, partners, or beneficiaries own directly,
indirectly, beneficially, or constructively a total of at least
fifty percent (50%) of the profits, capital, stock, or value of
one (1) or both persons.
As added by P.L.45-1992, SEC.1. Amended by P.L.254-2003, SEC.5;
P.L.81-2004, SEC.8.
Last modified: May 28, 2006