than the first day of the calendar quarter that is at least 
6 months after the date that the State— 
(1) enacts legislation to exercise the authority 
granted by this Act— 
(A) specifying the tax or taxes to which 
such authority and the minimum simplification 
requirements in paragraph (2) shall apply; 
(B) specifying the products and services 
otherwise subject to the tax or taxes identified 
by the State under subparagraph (A) to which 
the authority of this Act shall not apply; and 
(2) implements each of the following minimum 
simplification requirements: 
(A) Provide— 
(i) a single entity within the State re-
sponsible for all State and local sales and 
use tax administration, return processing, 
and audits for remote sales sourced to the 
State; 
(ii) a single audit of a remote seller 
for all State and local taxing jurisdictions 
within that State; and 
(iii) a single sales and use tax return 
to be used by remote sellers to be filed 
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with the single entity responsible for tax 
administration. 
A State may not require a remote seller to file 
sales and use tax returns any more frequently 
than returns are required for nonremote sellers. 
No local jurisdiction may require a remote sell-
er to submit a sales and use tax return or to 
collect sales and use taxes other than as pro-
vided by this paragraph. 
(B) Provide a uniform sales and use tax 
base among the State and the local taxing juris-
dictions within the State pursuant to paragraph 
(1). 
(C) Source all interstate sales in compli-
ance with the sourcing definition set forth in 
section 4(7). 
(D) Provide— 
(i) information indicating the tax-
ability of products and services along with 
any product and service exemptions from 
sales and use tax in the State and a rates 
and boundary database; 
(ii) software free of charge for remote 
sellers that calculates sales and use taxes 
due on each transaction at the time the 
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transaction is completed, that files sales 
and use tax returns, and that is updated to 
reflect rate changes as described in sub-
paragraph (H); and 
(iii) certification procedures for per-
sons to be approved as certified software 
providers. 
For purposes of clause (iii), the software pro-
vided by certified software providers shall be ca-
pable of calculating and filing sales and use 
taxes in all States qualified under this Act. 
(E) Relieve remote sellers from liability to 
the State or locality for the incorrect collection, 
remittance, or noncollection of sales and use 
taxes, including any penalties or interest, if the 
liability is the result of an error or omission 
made by a certified software provider. 
(F) Relieve certified software providers 
from liability to the State or locality for the in-
correct collection, remittance, or noncollection 
of sales and use taxes, including any penalties 
or interest, if the liability is the result of mis-
leading or inaccurate information provided by a 
remote seller. 
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(G) Relieve remote sellers and certified 
software providers from liability to the State or 
locality for incorrect collection, remittance, or 
noncollection of sales and use taxes, including 
any penalties or interest, if the liability is the 
result of incorrect information or software pro-
vided by the State. 
(H) Provide remote sellers and certified 
software providers with 90 days notice of a rate 
change by the State or any locality in the State 
and update the information described in sub-
paragraph (D)(i) accordingly and relieve any re-
mote seller or certified software provider from 
liability for collecting sales and use taxes at the 
immediately preceding effective rate during the 
90-day notice period if the required notice is 
not provided. 
(c) SMALL SELLER EXCEPTION.—A State is author-
ized to require a remote seller to collect sales and use taxes 
under this Act only if the remote seller has gross annual 
receipts in total remote sales in the United States in the 
preceding calendar year exceeding $1,000,000. For pur-
poses of determining whether the threshold in this sub-
section is met— 
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(1) the sales of all persons related within the 
meaning of subsections (b) and (c) of section 267 or 
section 707(b)(1) of the Internal Revenue Code of 
1986 shall be aggregated; or 
(2) persons with 1 or more ownership relation-
ships shall also be aggregated if such relationships 
were designed with a principal purpose of avoiding 
the application of these rules. 
SEC. 3. LIMITATIONS. 
(a) IN GENERAL.—Nothing in this Act shall be con-
strued as— 
(1) subjecting a seller or any other person to 
franchise, income, occupation, or any other type of 
taxes, other than sales and use taxes; 
(2) affecting the application of such taxes; or 
(3) enlarging or reducing State authority to im-
pose such taxes. 
(b) NO EFFECT ON NEXUS.—This Act shall not be 
construed to create any nexus between a person and a 
State or locality. 
(c) LICENSING AND REGULATORY REQUIREMENTS.— 
Nothing in this Act shall be construed as permitting or 
prohibiting a State from— 
(1) licensing or regulating any person; 
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(2) requiring any person to qualify to transact 
intrastate business; 
(3) subjecting any person to State or local taxes 
not related to the sale of goods or services; or 
(4) exercising authority over matters of inter-
state commerce. 
(d) NO NEW TAXES.—Nothing in this Act shall be 
construed as encouraging a State to impose sales and use 
taxes on any goods or services not subject to taxation prior 
to the date of the enactment of this Act. 
(e) NO EFFECT ON INTRASTATE SALES.—The provi-
sions of this Act shall apply only to remote sales and shall 
not apply to intrastate sales or intrastate sourcing rules. 
States granted authority under section 2(a) shall comply 
with all intrastate provisions of the Streamlined Sales and 
Use Tax Agreement. 
(f) NO EFFECT ON MOBILE TELECOMMUNICATIONS 
SOURCING ACT.—Nothing in this Act shall be construed 
as altering in any manner or preempting the Mobile Tele-
communications Sourcing Act (4 U.S.C. 116–126). 
SEC. 4. DEFINITIONS AND SPECIAL RULES. 
In this Act: 
(1) CERTIFIED
SOFTWARE
PROVIDER.—The 
term ‘‘certified software provider’’ means a person 
that— 
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(A) provides software to remote sellers to 
facilitate State and local sales and use tax com-
pliance pursuant to section 2(b)(2)(D); and 
(B) is certified by a State to so provide 
such software. 
(2) LOCALITY; LOCAL.—The terms ‘‘locality’’ 
and ‘‘local’’ refer to any political subdivision of a 
State. 
(3) MEMBER
STATE.—The term ‘‘Member 
State’’— 
(A) means a Member State as that term is 
used under the Streamlined Sales and Use Tax 
Agreement as in effect on the date of the enact-
ment of this Act; and 
(B) does not include any associate member 
under the Streamlined Sales and Use Tax 
Agreement. 
(4) PERSON.—The term ‘‘person’’ means an in-
dividual, trust, estate, fiduciary, partnership, cor-
poration, limited liability company, or other legal en-
tity, and a State or local government. 
(5) REMOTE SALE.—The term ‘‘remote sale’’ 
means a sale into a State in which the seller would 
not legally be required to pay, collect, or remit State 
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TKELLEY on DSK3SPTVN1PROD with BILLS
or local sales and use taxes unless provided by this 
Act. 
(6) REMOTE SELLER.—The term ‘‘remote sell-
er’’ means a person that makes remote sales in the 
State. 
(7) SOURCED.—For purposes of a State grant-
ed authority under section 2(b), the location to 
which a remote sale is sourced refers to the location 
where the item sold is received by the purchaser, 
based on the location indicated by instructions for 
delivery that the purchaser furnishes to the seller. 
When no delivery location is specified, the remote 
sale is sourced to the customer’s address that is ei-
ther known to the seller or, if not known, obtained 
by the seller during the consummation of the trans-
action, including the address of the customer’s pay-
ment instrument if no other address is available. If 
an address is unknown and a billing address cannot 
be obtained, the remote sale is sourced to the ad-
dress of the seller from which the remote sale was 
made. A State granted authority under section 2(a) 
shall comply with the sourcing provisions of the 
Streamlined Sales and Use Tax Agreement. 
(8) STATE.—The term ‘‘State’’ means each of 
the several States, the District of Columbia, the 
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Commonwealth of Puerto Rico, Guam, American 
Samoa, the United States Virgin Islands, the Com-
monwealth of the Northern Mariana Islands, and 
any other territory or possession of the United 
States. 
(9) STREAMLINED SALES AND USE TAX AGREE-
MENT.—The term ‘‘Streamlined Sales and Use Tax 
Agreement’’ means the multi-State agreement with 
that title adopted on November 12, 2002, as in ef-
fect on the date of the enactment of this Act and as 
further amended from time to time. 
SEC. 5. SEVERABILITY. 
If any provision of this Act or the application of such 
provision to any person or circumstance is held to be un-
constitutional, the remainder of this Act and the applica-
tion of the provisions of such to any person or cir-
cumstance shall not be affected thereby. 
SEC. 6. PREEMPTION. 
Except as otherwise provided in this Act, this Act 
shall not be construed to preempt or limit any power exer-
cised or to be exercised by a State or local jurisdiction 
under the law of such State or local jurisdiction or under 
any other Federal law. 
Æ 
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