Running an e-commerce business sounds simple: list your products, take orders, ship to customers. But do you have to collect sales tax on those shipments? That question is anything but simple to answer. Florida sales tax reaches e-commerce sellers in ways that many business owners and their CPAs do not anticipate — and the consequences of getting it wrong can include multi-year assessments, substantial penalties and interest, and personal liability for the business owners involved.
This article explains how Florida sales tax applies to e-commerce sellers, what creates a sales tax collection obligation in Florida, and — just as importantly — how selling into other states can trigger sales tax obligations far beyond Florida's borders.
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Who Is Required to Collect Florida Sales Tax?
Florida imposes a 6% state sales tax on the retail sale of tangible personal property delivered to customers in Florida, plus any applicable county discretionary sales surtax, which varies by county and typically ranges from 0.5% to 1.5%. A business becomes a "dealer" under Florida law — and is therefore required to register, collect, and remit Florida sales tax — when it has the legally required connection to Florida.
That connection is called nexus. For e-commerce sellers, nexus in Florida can arise in two principal ways: physical presence and economic activity.
Physical Presence Nexus in Florida
Long before the rise of e-commerce, Florida law imposed a sales tax collection obligation on any business with a physical presence in the state. The Florida Statutes define "dealer" broadly under Section 212.06, F.S., to include any person who maintains within Florida — directly or through a subsidiary — an office, distributing house, salesroom, warehouse, or other place of business.
Physical presence nexus for sales tax is not limited to a storefront or corporate office. According to the Florida Department of Revenue, a physical presence includes any of the following:
- Employees or representatives in Florida. Having employees, agents, or representatives who solicit orders, take orders, deliver merchandise, accept payments, service merchandise, or otherwise represent the business in Florida creates nexus. This includes remote employees who work from home in Florida, field sales representatives, and installation or service technicians who make customer visits in Florida.
- Inventory stored in Florida. Owning or controlling inventory physically located in Florida creates nexus — even when that inventory is warehoused by a third-party logistics provider rather than the seller. E-commerce sellers participating in Amazon's Fulfillment by Amazon (FBA) program who have inventory placed in Amazon's Florida fulfillment centers have a physical presence in Florida and are required to register and collect Florida sales tax regardless of their sales volume.
- Independent contractors performing services in Florida. Using subcontractors or independent contractors to perform services for customers in Florida — including installation, assembly, repair, warranty work, or delivery — can create physical presence nexus to Florida for the contracting business.
- Trade show and temporary activity. Florida does not provide a clear safe harbor for temporary physical presence such as trade show attendance. However, if a non-Florida company or person attends a tradeshow and sells tangible personal property at retail, then the seller must collect and remit tax on that sale. However, there is a 1996 case (Dept of Revenue v Share International Inc) that held that despite a company representative not only attending a trade show for several days but only collected and remitted Florida sales tax while at the tradeshow, the contact with Florida was not enough to give the company nexus for Florida sales tax purposes on all other sales into the state (from out of the state). Does that answer change if the company sends representatives to 3 Florida trade shows in a year? Good question and there is no clear guidance. A seller who regularly attends trade shows or other events in Florida to solicit business or take orders may have nexus based on the regular presence of its personnel in the state.
Physical presence nexus takes effect from the moment the relevant activity begins. There is usually no minimum threshold and no look-back period — nexus arises immediately when a qualifying activity commences in Florida.
Economic Nexus in Florida (Post-Wayfair)
In 2018, the United States Supreme Court issued its landmark decision in South Dakota v. Wayfair, Inc., holding that states could impose sales tax collection obligations on remote sellers based on economic activity alone, without any physical presence in the state. I attended that hearing before the US Supreme Court and I was the lead author on an Amicus Brief in that case. Very sad result, but the good news is that Florida was one of the last states to respond to Wayfair: economic nexus legislation was enacted in April 2021 and took effect July 1, 2021.
Florida's economic nexus rule is codified at Section 212.0596, F.S. Under that statute, any remote seller that makes a "substantial number of remote sales" is treated as a dealer and must register, collect, and remit Florida sales tax. A "substantial number of remote sales" is defined as taxable remote sales in the previous calendar year in which the total sales price exceeded $100,000.
Several key features of Florida's economic nexus rule deserve attention:
No transaction threshold. Unlike many states, Florida's economic nexus standard is purely dollar-based. There is no separate transaction count threshold. A single large sale that pushes a seller over $100,000 is sufficient to trigger the obligation.
Prior calendar year look-back. The $100,000 threshold is measured against the prior calendar year. A seller that exceeded $100,000 in Florida sales during 2025 is required to register and begin collecting Florida sales tax effective January 1, 2026.
Tangible personal property only. Florida's economic nexus statute applies to remote sales of tangible personal property delivered to Florida customers. Florida does not impose sales tax on most services, and the economic nexus rule does not extend to services that are not otherwise taxable under Chapter 212.
Marketplace facilitator exclusion from threshold. If a seller makes sales through a registered marketplace facilitator — such as Amazon, eBay, Etsy, or Walmart Marketplace — those sales do not count toward the seller's own $100,000 economic nexus threshold, because the marketplace facilitator is treated as the dealer and is responsible for collecting and remitting the tax. Only direct sales made outside of a marketplace platform count toward the individual seller's threshold. Just be careful with this because keeping inventory in Florida with a Marketplace Facilitator gives you physical presence nexus, making the $100,000 economic nexus threshold irrelevant.
Marketplace Facilitator Rules
The same legislation that enacted economic nexus in Florida also created a marketplace facilitator framework under Section 212.05965, F.S. A marketplace provider that has a physical presence in Florida, or that makes or facilitates a substantial number of remote sales through its platform, is treated as a dealer under Florida law. That marketplace provider is required to certify to its marketplace sellers that it will collect and remit Florida sales tax on their behalf.
When a marketplace facilitator is collecting and remitting the tax on a seller's transactions, the individual seller is prohibited from also collecting tax on those same transactions and must exclude those sales from its own Florida sales tax return.
This framework significantly simplifies compliance for many small e-commerce sellers. A seller whose Florida sales occur entirely through Amazon or Etsy, for example, may not need to register with the Florida Department of Revenue at all — provided the seller has no physical presence in Florida and has not exceeded the $100,000 threshold through direct sales.
However, sellers who use a combination of marketplace sales and direct sales (through their own website, for example) must carefully track the two revenue streams. Marketplace sales are excluded from the threshold calculation, but direct sales count in full. A seller with $80,000 in direct Florida sales and $200,000 in Amazon-facilitated Florida sales has not crossed the economic nexus threshold based on direct sales alone AS LONG AS those Amazon sales are fulfilled by the sellers inventory kept in Florida. Inventory IS physical presence nexus. But if that same seller also has a Florida-based employee or Florida-warehoused inventory, physical presence nexus exists regardless of sales volume.
What Is Taxable? Florida Sales Tax and E-Commerce Products
Florida sales tax applies to the retail sale of tangible personal property unless a specific exemption applies. For most e-commerce sellers shipping physical goods to Florida customers, the product itself is likely taxable. Common e-commerce product categories that are taxable in Florida include clothing, electronics, furniture, household goods, sporting goods, books, and most other physical merchandise.
Florida does provide exemptions for certain categories, including groceries (with important distinctions for prepared food), prescription medications and certain medical devices, agricultural inputs, and certain manufacturing equipment. Sellers of products that may qualify for an exemption should carefully review the applicable statute and Florida Administrative Code rules before concluding that no tax applies (and make sure you are saving the right exemption paperwork).
Florida does not impose sales tax on most digital goods — including digital downloads of music, software, and e-books — or on most services. However, software delivered on tangible media (a physical disc) is taxable as tangible personal property, and certain services enumerated under Chapter 212 are taxable. E-commerce businesses that also sell services should carefully analyze whether those services fall within the categories Florida taxes.
Shipping charges can be a trap for unwary sellers. If shipping is separately stated on the invoice and title to the goods passes to the buyer at the point of shipment, shipping charges are generally not subject to Florida sales tax. Furthermore, if the shipping charges are separately stated and OPTIONAL to the customer (the can pick it up or arrange their own delivery), then delivery charges are not subject to Florida sales tax. However, if shipping and handling are combined into a single charge (shipping charge is not separately stated), the entire amount will be treated as part of the taxable sales price.
Multistate Nexus: The Bigger Picture for E-Commerce Sellers
For e-commerce businesses selling into multiple states, Florida is only one piece of a much larger compliance picture. The Wayfair decision opened the door for every state with a sales tax to impose collection obligations on remote sellers, and every state has now acted on that authority. As of mid-2021, all 45 states that impose a general sales tax have enacted economic nexus legislation.
Most states use a threshold of $100,000 in annual sales or 200 transactions, though some states have moved to a sales-only threshold (as Florida has done). California has a $500,000 threshold. The look-back period, the types of sales that count toward the threshold, and the treatment of marketplace sales all vary from state to state. An e-commerce seller with broad national reach may have collection obligations in dozens of states simultaneously.
Traditional Physical Presence Nexus in Other States
I can’t tell you just how many companies come to me to discuss cleaning up their economic nexus states only to realize they have been looking at the wrong nexus rules the whole time. So many of these companies already had nexus prior to economic nexus existing. Here is the problem. The economic nexus framework is new — but the traditional rules creating physical presence nexus in other states have not gone away. E-commerce businesses often trigger physical presence nexus in states they do not expect, through activities that seem routine:
Employees working remotely. The growth of remote work has created nexus exposure for employers across the country. An e-commerce business that hires an employee who works from home in another state typically has physical presence nexus in that state — regardless of whether the employee's role is sales-related, technical, or administrative. Many businesses discovered this exposure during and after the COVID-19 pandemic, when employees relocated across state lines.
Inventory at third-party fulfillment centers. E-commerce sellers using multi-state fulfillment networks — whether Amazon FBA, Shopify Fulfillment Network, or other third-party logistics providers — should audit where their inventory physically sits. Inventory stored in a fulfillment center in any state creates physical presence nexus in that state for the inventory owner, even though the seller chose the fulfillment location.
Use of subcontractors and independent contractors. An e-commerce seller that uses independent contractors to perform on-site services for customers in another state — including installation, repair, warranty work, or assembly — likely has physical presence nexus in that state based on the activities of those contractors. There is a US Supreme Court case on point here that held the activities of independent contractors performing services on behalf of a business is the same as activities of the business's own employees for sales tax nexus purposes (see, Scripto v Carson 362 US 207 (1960)).
Sales representatives. An independent sales representative or manufacturer's representative who solicits orders in a state on behalf of an e-commerce seller can create physical presence nexus in that state. This is true even if the rep also represents other companies and is not an exclusive agent of the seller.
Trade shows and temporary presence. Many states do impose nexus based on temporary in-state activity such as trade show attendance, particularly when orders are taken or sales are made at the event. The threshold for temporary nexus varies by state, and some states provide express safe harbors while others do not.
The Practical Risk for Growing E-Commerce Businesses
An e-commerce seller that has grown from local to national scale over the past several years may have accumulated significant unfiled sales tax obligations in multiple states. The risk is real: states actively use third-party data sources, including marketplace sales data, shipping records, and business registration information, to identify non-registered sellers with collection obligations. The liability is growing every month you do nothing.
If a state opens a nexus audit on your company, the statute of limitation to look back years is limited only by when you created nexus with the state – any nexus. Not just economic nexus. So when did you start delivering goods to a state with your company employees? When did you start having a remote employee in that state? When did you use subcontractors in that state? That is how far back they can go, if you don’t do a Voluntary Disclosure. The assessment can include tax, penalties, and interest on every taxable transaction during that period. For a seller that has been non-compliant for years in multiple states, the aggregate exposure can be substantial.
The Voluntary Disclosure Option
E-commerce businesses that have identified potential back-year sales tax exposure — whether in Florida or in other states — should seriously consider the voluntary disclosure process before they are audited. Florida's Voluntary Disclosure Program, administered by the Florida Department of Revenue under Section 213.21, F.S., allows eligible taxpayers to come forward, pay the taxes owed for a limited look-back period (generally three years), and avoid most or all penalties.
Multistate voluntary disclosure programs are also available for some states through the Multistate Tax Commission (MTC), which administers a program that allows eligible sellers to obtain voluntary disclosure agreements in multiple states simultaneously. These programs are available to sellers that have not yet been contacted by the relevant taxing authorities. We have handled hundreds MTC voluntary disclosures for our clients.
Voluntary disclosure is not always available — sellers that have already been contacted by a state's department of revenue or are under audit generally cannot use the voluntary disclosure process for the periods under review. The window to act voluntarily closes once a state makes contact.
SHOULD YOU JUST SHUT DOWN YOUR BUSINESS AND START OVER?
Should you just shut down the business because the sales tax amount is as much or more than I make in a year? I do get this question a lot. The answer is usually NO for multiple reasons. First, shutting down the business does not magically make the sales tax liability go away. States have the power to pierce the corporate veil to come after the owners and responsible parties (in Florida it is a 200% of tax penalty). States also have statutes that let them come after the new company for the old company’s sales tax liabilities when assets are transferred from the old company to the new one – aka Transferee Liability.
Second, and this is just as important, you should think about how much your company is worth. Valuations for businesses are usually 8 to 10 times their net income, even more for a tech company. So, if your company is making $1,000,000 bottom line profit, your company is worth $8 to $10 million. Does it really make sense to close down a $10 million business for a $1 million dollar debt? I think any reasonable business owner would say no, when you look at it from this perspective.
Frequently Asked Questions
Q: I sell only through Amazon. Do I have to collect Florida sales tax?
A: If Amazon is collecting and remitting Florida sales tax on your behalf as a registered marketplace facilitator — which it does for most third-party sellers — then you do not need to separately collect and remit Florida sales tax on those transactions. However, if you also have inventory stored in a Florida Amazon fulfillment center, you have physical presence nexus in Florida independently of your sales volume, and you should confirm your registration status with the Florida Department of Revenue. Also, if you are buying inventory in Florida, then you need to register to have a Florida resale certificate to buy tax exempt under the sale for resale exemption.
Q: My e-commerce business is based outside Florida. When does Florida sales tax apply to me?
A: Florida sales tax applies to you if your Florida sales in the prior calendar year exceeded $100,000 in tangible personal property (economic nexus), or if you have a physical presence in Florida — such as inventory, employees, or contractors operating in the state. The obligation begins either at the start of the calendar year following the year you crossed the threshold (economic nexus) or immediately upon establishing a physical presence.
Q: I have a remote employee who moved to Florida. Does that create Florida sales tax nexus for my company?
A: Yes. Having an employee physically located in Florida who performs activities for the business — including selling, soliciting orders, customer service, or support activities — is a recognized basis for physical presence nexus under Florida law. You should consult with a Florida sales tax attorney to evaluate your specific facts and exposure.
Q: I use a third-party fulfillment center in Florida. The inventory is in Florida, but I never chose that location specifically — the fulfillment network placed it there. Do I still have nexus?
A: Yes. Florida does not provide a safe harbor for sellers whose inventory is placed in Florida by a marketplace or fulfillment provider without the seller's specific direction. Physical presence of your inventory in a Florida warehouse creates nexus for you regardless of who made the decision to store it there.
Q: What happens if I have not been collecting sales tax in states where I should have been?
A: You have a growing sales tax liability in that state. Growing every month. You should consult with a sales tax attorney promptly. The longer the non-compliance continues, the larger the potential exposure. Voluntary disclosure programs in Florida and other states offer a structured way to come into compliance, limit the look-back period, and abate penalties — but they are only available before the taxing authority makes contact with you. But once you get into a state’s Voluntary Disclosure program, then you start collecting the sales tax from your customers (and not taking on the liability in your company)!
Q: Does Florida sales tax apply to digital downloads and SaaS products?
A: Generally no. Florida's sales tax applies to tangible personal property, and Florida has not enacted legislation extending the tax to most digital goods or software-as-a-service (SaaS) products delivered electronically without the transfer of tangible media. However, the analysis is fact-specific, and sellers of software or digital products should obtain a written opinion on their specific product before concluding no tax applies.
About the Author
James H. Sutton, Jr., CPA, Esq. is a Florida-licensed CPA and State and Local Tax (SALT) attorney as well as a shareholder at the Law Offices of Moffa, Sutton & Donnini, P.A., a Florida state and local tax law firm practicing exclusively in Florida sales and use tax controversy. The firm represents businesses before the Florida Department of Revenue at all stages of the audit and appeals process and assists clients with multistate sales tax compliance and voluntary disclosure. James can be reached at 888-444-9568, JamesSutton@FloridaSalesTax.com or through the firm's website at HERE.
Additional Resources
- FLORIDA SALES TAX – INADVERTENT REGISTRATION: WHAT IT IS AND HOW IT CAN SAVE YOUR BUSINESS, published June 5, 2026, by James Sutton, CPA, Esq.
- DO I HAVE TO CHARGE FLORIDA SALES TAX ON A WHOLESALE SALE?, published June 7, 2026, by James H Sutton, Jr, CPA, Esq.
- FLORIDA SALES TAX VOLUNTARY DISCLOSURE: THE BEST WAY TO CLEARN UP A FLORIDA SALES TAX PROBLEM, published May 26, 2026, by James H Sutton, Jr, CPA, Esq.
- FLORIDA SALES TAX FOR REMOTE SELLERS, published November 2018, by James H. Sutton, Jr., CPA, Esq.
- FLORIDA SALES TAX ON ONLINE PURCHASES, published December 2019, by David J. Brennan, Jr., Esq.
- 2021 FLORIDA ECONOMIC NEXUS PASSED, published April 2021, by James H. Sutton, Jr., CPA, Esq.
- CAN I TRUST AI FOR FLORIDA SALES TAX ADVICE?, published June 6, 2026, by James H Sutton, Jr, CPA, Esq.
© Copyright 2026. James H Sutton, Jr. All rights reserved.