Enterprise
Individual & Small Business
California Sales Tax Nexus: Economic Nexus Threshold (2026)
California's economic nexus threshold for remote sellers is $500,000 in sales, measured over the preceding or current calendar year. Marketplace sales count toward California's threshold. Inventory or another physical presence in California generally creates nexus regardless of sales. The state rate is 7.25%, plus local taxes.
California sales tax nexus: key facts
| Sales threshold | $500,000 |
|---|---|
| Transaction threshold | None |
| Test | Sales only |
| What counts | Total combined sales of tangible personal property for delivery in California by the retailer and all related persons (IRC 267(b)); includes nontaxable sales such as sales for resale. |
| Measurement period | Preceding or current calendar year |
| Marketplace sales count toward your threshold? | Yes, counted |
| Marketplace facilitator law | Yes: marketplaces generally collect on the sales they facilitate |
| State rate | 7.25% |
| Local sales taxes | Yes, in addition to the state rate |
| Current threshold effective | April 25, 2019 |
| Recent change | None found in our research |
| Registration | Official registration page |
| Last researched | September 23, 2026 |
The state rate is the statewide state-level rate only. Local and district rates are extra where they apply.
Quick check: do you have nexus in California?
Enter your California sales to see whether you may have nexus.
Selling into several states? Use the full Sales Tax Nexus Checker. Your figures stay in your browser.
What to do after crossing the California threshold
We did not find a specific start-date rule for California in the sources reviewed. Check the official guidance before you begin collecting.
- Confirm the numbers. Check your California sales against the measure and period in the key facts above.
- Register before you collect. Use California's official registration page. Collecting a state's tax without a registration is generally not allowed.
- Collect and file. Charge California sales tax (plus any local taxes that apply at the delivery address) on taxable sales from the start date, and file returns on the schedule the state assigns. Marketplaces generally collect on the sales they facilitate, so you usually collect on your direct sales.
- Look back. If you crossed the threshold in an earlier period and did not register, get advice on those periods. Many states have voluntary disclosure programs that may limit penalties.
Physical presence and inventory in California
Inventory or other property in the state (including Amazon FBA or 3PL warehouse inventory), employees, or an office generally creates physical-presence nexus regardless of the economic threshold. CDTFA lists physical presence examples (e.g., property or inventory in CA) as independently requiring registration.
Marketplace sellers in California
Do marketplace sales count toward your own threshold? Yes, counted.
CDTFA's Marketplace Facilitator Act guide says a marketplace seller must include its sales made through a marketplace facilitator when testing the $500,000 threshold. A seller whose California sales are all made through registered marketplace facilitators that are the retailer for those sales does not have to register. Since October 1, 2019, the marketplace facilitator is the retailer for facilitated sales, and a registered seller deducts them on its return.
Other things to know about California
- Sales of related companies (as defined in IRC section 267(b)) are aggregated when testing the $500,000 threshold.
- Meeting the $500,000 threshold also makes the retailer 'engaged in business' in every district that imposes a district tax, so it must collect district use tax statewide (operative 4/25/2019).
- The 7.25% statewide base rate includes 1.25% of mandatory local (Bradley-Burns) tax; district taxes add more depending on the delivery address.
- AB 147 set the $500,000 threshold; the earlier $100,000 / 200-transaction standard (4/1/2019 to 4/24/2019) no longer applies.
Frequently asked questions
What is the California economic nexus threshold?
$500,000 in sales, measured over the preceding or current calendar year. What counts: Total combined sales of tangible personal property for delivery in California by the retailer and all related persons (IRC 267(b)); includes nontaxable sales such as sales for resale.
Do marketplace sales count toward the California threshold?
Yes, counted. CDTFA's Marketplace Facilitator Act guide says a marketplace seller must include its sales made through a marketplace facilitator when testing the $500,000 threshold. A seller whose California sales are all made through registered marketplace facilitators that are the retailer for those sales does not have to register. Since October 1, 2019, the marketplace facilitator is the retailer for facilitated sales, and a registered seller deducts them on its return.
Does FBA or 3PL inventory in California create nexus?
Inventory or other property in the state (including Amazon FBA or 3PL warehouse inventory), employees, or an office generally creates physical-presence nexus regardless of the economic threshold. CDTFA lists physical presence examples (e.g., property or inventory in CA) as independently requiring registration.
Does California have a transaction-count test?
No. California uses only the dollar threshold.
Crossed the California threshold, or not sure? A professional can confirm it and handle registration.
Nexus Study + Registration + Cleanup
Fixed price, quoted before any work starts
- State-by-state review of your sales and inventory locations
- Registration in states where you have nexus
- Plan for any past-due periods (including voluntary disclosure where appropriate)
- Ongoing sales tax filing option
Disclaimer: This page provides general information for educational purposes and is not tax, legal or accounting advice. State rules change, and whether you have nexus can depend on facts not covered here. Confirm with California's official guidance or a qualified professional before acting. RAHA Financials is not affiliated with any state tax agency.
Sources
- Primary official source: https://www.cdtfa.ca.gov/industry/wayfair.htm
- cdtfa.ca.gov: https://www.cdtfa.ca.gov/industry/wayfair/frequently-asked-questions.htm
- streamlinedsalestax.org: https://www.streamlinedsalestax.org/for-businesses/remote-seller-faqs/remote-seller-state-guidance
- salestaxinstitute.com: https://www.salestaxinstitute.com/resources/economic-nexus-state-guide