Overview
Typically, once a company is registered and filing sales tax returns with a state, it is difficult to close a sales tax registration and cease filing returns. Deregistration is difficult even if a company no longer has an office or employee in the state. Nexus is easy to establish but hard to lose.
If a taxpayer has a history of at least a year with no sales and zero dollar returns, closing a sales tax account may be possible, but these rules vary by jurisdiction. When deciding to de-register in a jurisdiction, there are a few things you should consider:
- Administrative work — Deregistration can require a lot of administrative work since states sometimes require a waiting period and will have additional questions (i.e. reviewing prior returns, etc.).
- Fluxating registration status — In states like Texas — where hiring is common — sometimes you will de-register and immediately have to re-register.
- Customer confusion — Deregistering and re-registering can cause customer confusion since their tax amount will constantly change depending on your registration status.
Note
Deregistration within a jurisdiction is a service that Anrok does not provide. To determine if closing your sales tax account is a viable option, we recommend contacting the relevant jurisdiction to verify if your business qualifies for deregistration. See Jurisdiction filing directory. If you decide to deregister yourself, you can submit this form when the de-registration is nearing completion (or if you have already closed a sales tax account with a jurisdiction) so we can adjust your instance accordingly.