In 2024, Maryland has updated its click-through nexus requirements to enhance tax compliance from affiliate-driven sales:

Updated Requirements:

1. Lowered Sales Threshold: The sales threshold for out-of-state vendors to collect sales tax was reduced from $100,000 to $75,000 in annual sales.

2. Affiliate-Linked Sales Threshold: The threshold for establishing nexus through affiliate agreements is now $10,000 in affiliate-linked sales, down from a higher previous threshold.

3. Documentation: Businesses must maintain detailed records of affiliate relationships and referral sales to verify compliance.

4. Reporting Obligations: Sellers must provide comprehensive reports of affiliate-driven sales to the Comptroller’s office.

Updated Penalties:

1. Increased Fines: Penalties for non-compliance have been heightened, with fines doubling from previous caps.

2. Interest Charges: Additional interest on unpaid taxes applies from the due date until full payment.

3. Legal Consequences: Persistent non-compliance can lead to legal actions, including fines and potential criminal charges for willful tax evasion.

These updates make click-through nexus stricter, requiring businesses to monitor affiliate sales closely, implement robust tracking systems, and ensure accurate tax collection and remittance. Failure to comply results in substantial financial penalties and increased legal risks, emphasizing the importance of diligent adherence to Maryland’s updated click-through nexus regulations.