State of Wayfair: Seesawing Sales May Prompt Due Process Claims

Complying with a patchwork of Wayfair-inspired state sales and use tax laws is tough enough for small remote sellers, but what happens to retailers routinely battered by fluctuating sales?

Patterns of sales surges and droughts could create scenarios in which small sellers have economic presence in a particular state one year, but not the next. The uncertainty and burden associated with tax compliance for these retailers could constitute a viable due process violation, according to Fred Nicely, senior tax counsel at the Council on State Taxation, a Washington-based nonprofit trade association.

“I could see a due process issue ...