The least risky solution, but also the most onerous, is to collect sales tax on EVERYTHING, but taking this path comes with it’s own hidden risks…like staying in business.
This is a problem faced by almost every online retailer, and the smaller your profit margin, the more difficult it is to justify a business decision that will subject your sales to the whims and laws of the thousands of taxing jurisdictions around the US.
Key Issues & Questions
Interstate Commerce Clause &emdash; Your rights under the United States Constitution.
Nexus &emdash; Do your business activities in a jurisdiction subject you to local tax laws?
How the internet changes the game and how we’ve seen this interstate commerce show before (PDF).
Places to Begin Your Research
Didn’t have time to add a lot of meat to this article and I hope to in the future, so if you have any advice, please let us hear it in the comments!