The Texas Nexus law could have serious consequences for MACNA 2012 vendors & exhibitors

By on Aug 25, 2012

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Attention MACNA 2012 vendors and exhibitors. It has come to our attention that there is a Texas law which may have serious implications for current, previous and future retailers of any goods within the republic state of Texas. According to our limited and completely unprofessional legal understanding of the Nexus law in Texas, retailers who make an appearance physically in Texas may be held liable for sales tax for goods shipped to Texas for past sales.

What we interpret this to mean is that if Bob sold a coral and shipped it to a customer in Texas last year, if Bob shows up in any professional capacity within Texas, including selling corals in Texas for the DFW MACNA, the Nexus law states that Bob could have to pay sales tax on that sale from way back in the day. Multiply that example by a thousand sales over several years and you can see where Bob may have a problem.

We don’t fully know how this affects the vendors and exhibitors of the DFW MACNA later this September but if you are a retailer of marine aquarium goods who has ever or plans to sell goods in Texas, it behooves you to consult a legal professional regarding the specifics of the Texas Nexus law.

DISCLAIMER: We dot represent legal counsel, we don’t know jack about legalese and we do not in any way represent legal advice about Texas or tax laws, not at ALL!!

Posted in Reef News |
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  • Andrew

    Wow! funny How you guys would post this without first checking refrences and contacting the State. I would think you would want to help MACNA and MASNA not hurt them….

  • http://twitter.com/clownfishman Hubert CLOWNFISHMAN

    well, I think it’s a valid warning for anybody that participates in any professional activities related to MACNA. I guess people have to know the rules to take their stand.
    … just like how USFWS show up last year in Des Moines MACNA …

  • Guest

    DFWmas knew about this 7 months ago.

  • http://www.facebook.com/people/Craig-Johnston/1004239789 Craig Johnston

    … just like how USFWS show up last year in Des Moines MACNA …

    They did? News to me.

  • Andrew

    really…. Hows that?

  • http://www.facebook.com/profile.php?id=1020440313 Tal Sweet

    Sure you’re not thinking of Orlando?

  • http://www.facebook.com/people/Michael-Thompson/100003123012524 Michael Thompson

    Just so you know. This has always been the case in all states. If I order something In IA and have it delivered to CA. There is this thing called a use tax that I am responsible for. Nobody pays it but you are supposed to.

  • vendor12

    That’s an interesting outlook Andrew,
    Kind of a “shoot the messenger” approach
    I see it as helping vendors that help the hobby avoid a potential world of hurt and possibly even be forced out of business.
    The bigger issue IMO is why do vendors learn this now and in this manor and not from MACNA and or MASNA? How long have they known?
    What hurts the show most? giving people a chance to prepare or showing up to a surprise and a possible shut down?

  • http://www.facebook.com/people/Jon-Carvallo/551135810 Jon Carvallo

    No, they didn’t… it was at Macna 2010 in Orlando.

  • vendor12

    you are confusing personal and commercial this NEXUS law applies to businesses

  • Andrew

    I am simply saying after reading the article it looks like they are shooting from the hip instead of taking the time to verify sources, contact the state of texas, etc…..

  • http://twitter.com/jason_alv Jason Alvarado

    Texas is not the only state with nexus laws, though it is stricter that some. Any financially responsible sales tax paying vender should know the tax collection policies of each particular state he is in and make a decision on whether to attend a convention. That being said, its probably a non-issue.

  • http://twitter.com/jason_alv Jason Alvarado

    Exactly. The state comptrollers office is actually very good at delivering an official ruling on a sales tax matter. All you have to do is pickup the phone or write a letter to them.

  • http://twitter.com/REEF2REEF REEF2REEF

    I hate this if some vendors have to pull out, but REEF2REEF.com will be there will bells on! Can’t wait to see you all!

  • Spencer Matonis

    Bob’s in da shit now O:

  • http://www.facebook.com/people/Matt-Meadows/100001064246230 Matt Meadows

    North Carolina, technically, has a similar law. You are required to report all purchases you made, mail-order, that did not collect state sales tax, and you must pay state sales tax on them. And, while most people ignore this, I do not. In my case, it’s not all that much, and even though I think it’s robbery (particularly in North Carolina where I vehemently disagree with much of the way taxpayer money is wasted horrendously), I still pay it simply to obey the law and stay above reproach. I simply voice my animosity against the tax laws in my voting.

  • Mike

    how about this, the vendors open up a secondary company that is simply an advertising firm that has a single customer which happens to be the vendor. They work for both companies but only the advertising “firm” is what goes, since they don’t actually sell in Texas they’re in the clear! :D

  • http://twitter.com/clownfishman Hubert CLOWNFISHMAN

    sorry you guys were right, it was Orlando :)

  • http://www.facebook.com/mitch.miller.94 Mitch Miller

    I think an even bigger issue in Texas is that the raffle laws are very strict. From the way I read the law many aspect of the raffle will construe it as an illegal lottery. Both organizers and participants can be changed. https://www.oag.state.tx.us/consumer/raffle.shtml

  • XD_1

    This is a seperate issue. Most states “require” individuals to pay sales tax on goods they purchase mail order. What’s happening here is that if an out of state vendor sets up shop for a weekend in Texas, not only would they be required to collect and pay the state sales tax (reasonable), the state may also ask them to pay sales tax on everything it’s ever shipped to Texas before (unreasonable).

    If I were a vendor I’d consult my attorney first, but my hunch is that it’s generally unenforceable.

  • Guest

    Lol Texas sucks. They have ridiculous laws, and pretty much punish anyone standing within 100yds of someone who commits a crime. This isn’t surprising.

  • Andrew

    its awesome all the random law interpretations…..

    That is the law for charitable raffles, which are open to the public…..not applicable to the Macna raffle as it is not open to the public and falls under a completely different set of laws.

  • aquadigitalinc

    and do tell how they would police this? Is like the canadian tax law, you buy from another province you are supposed to then call up the CRA and tell them so they can bill you for the provincial tax portion. of course everyone does it dont they!

  • http://www.facebook.com/todd.cherry.52 Todd Cherry

    I’m no lawyer either but a real live lawyer sent me this :)

    http://www.window.state.tx.us/taxinfo/taxpubs/tx96_276.html

  • vendor12

    I hope this proves to be the answer, and it’s not too late

  • Rick

    Sorry but if I was a business owner and worried about attending any of the shows or conferences in various states including macna in Texas this year I would get my information from my CPA, certainly not from Jake Adams in a write up on a reef forum. Anyone in a few minutes on the Internet can find there are a variety of nexus laws in many states that can effect e-retailers. Some including California have had vendors attend shows this year without any problems or at least No One bothered to warn anyone else about their concerns with the states nexus laws. I wonder why?

  • http://www.facebook.com/jim.gryczanowski Jim Gryczanowski

    Don’t you think vendors should be made aware of the law regardless of it being enforced or not? Imagine showing up to this event, setting up your huge booth and then getting a letter from the State of Texas requesting your sales records from the last 10 years, now what if you have sold $500,000 in goods in the state of Texas during this time frame and now they want back sales tax, penalties and fines. This could bankrupt some companies. Informing the vendors up front so they can research, consult with legal and figure out the best way to aproach the event seems like good business. Theres a reason, major retailers have already pulled out. All this article did was put the information out there, now vendors need to understand the law and if it affects them.

  • http://www.facebook.com/mitch.miller.94 Mitch Miller

    I spoke to an attorney friend and he said this is partially correct. There is a whole new set of rules for a private event. One states that you can hold a private poker night and or a lotto but you can’t make a dime on it. Every bit of profit must be distributed to those participating at the end of the night. There were other caveats that must also be followed but I have been assured that the local club had an attorney check into this years ago.

  • CrabRangoon

    This is not the first time for MACNA to be held in Texas, and this certainly didn’t seem to be a factor years ago when it was in Houston, Texas.