If you’re a Pennsylvania seller shipping goods to a customer in another state, you generally do not charge PA sales tax on that order. Pennsylvania’s 6% sales tax applies to retail sales delivered within the Commonwealth, so once the package is handed to a carrier and delivered to an out-of-state address, the PA tax falls away.1Commonwealth of Pennsylvania. Tax Rates The catch: the destination state may require you to collect its own tax on that sale, and the buyer may owe use tax if no one collects at all.
One immediate exception. If the out-of-state customer walks into your Pennsylvania store or warehouse and picks the item up in person, the sale happened in Pennsylvania. You charge PA sales tax at the applicable rate no matter where the buyer lives. Delivery method is what separates a taxable in-state sale from a nontaxable interstate shipment.
How Pennsylvania Sources the Sale
Pennsylvania uses destination-based sourcing. Under 72 P.S. § 7202, the 6% tax applies to retail sales occurring “within this Commonwealth,” and 61 Pa. Code § 32.5 confirms that the tax attaches when delivery is made to a location inside the state.2Commonwealth of Pennsylvania. 61 Pa. Code 32.5 – Multi-State Sales Where the customer takes possession decides the question. That same logic dissolves the local add-ons in Allegheny County (1%) and Philadelphia (2%) for out-of-state shipments — neither attaches to a package headed to Ohio or New Jersey.1Commonwealth of Pennsylvania. Tax Rates
Digital products work the same way. Pennsylvania taxes downloads, streaming subscriptions, apps, games, and canned software at 6%, and the sale is sourced to the customer’s billing address on file. If that address is outside Pennsylvania, PA sales tax does not apply.3Commonwealth of Pennsylvania. Digital Products For digital sales there’s no shipping receipt to fall back on, so your billing records are the documentation.
When the Destination State Requires You to Collect
The sale isn’t automatically tax-free just because Pennsylvania doesn’t tax it. Since South Dakota v. Wayfair, Inc. in 2018, states can require you to register and collect their sales tax even when you have no office, warehouse, or employees on the ground there.4Supreme Court of the United States. South Dakota v. Wayfair, Inc., et al. This is called economic nexus, and it turns on thresholds.
The most common trigger is $100,000 in gross sales into the state during the prior or current calendar year. Some states also count 200 separate transactions, though as of mid-2025 more than 15 states have dropped the transaction-count test and rely only on the dollar threshold. Pennsylvania itself uses a sales-only threshold of $100,000 with no transaction count for remote sellers.5Commonwealth of Pennsylvania. Online Retailers Each state sets its own number, so a business selling nationwide needs to track sales by destination.
Inventory in a Fulfillment Warehouse Still Counts
Physical nexus didn’t disappear with Wayfair. If your inventory sits in a third-party fulfillment center — including Amazon FBA warehouses — you likely have nexus in every state where that stock is held. You don’t have to own the warehouse or choose the location. When a logistics provider redistributes your goods among multiple centers, you can pick up nexus in each of those states without noticing. Even small, short-term storage can be enough.
The exposure for missing this matters. States can assess back taxes, interest, and penalties on sales you should have been collecting on. Audit lookback is typically three to four years when returns were filed, but if you never registered at all, many states impose no time limit and can reach back for every year you should have been collecting.
Selling Through Amazon, eBay, Etsy, or Walmart
If your sales flow through a major marketplace platform, the platform is likely already collecting and remitting sales tax for you. Every state with a sales tax now has a marketplace facilitator law that treats the platform as the retailer for tax purposes, which relieves the individual seller of the collection duty on facilitated sales.
The relief has limits. Sales you make through your own website, over the phone, or at trade shows aren’t covered by the platform’s collection. Those channels remain your responsibility, and if they cross a state’s threshold on their own, you still need to register and collect in that state. Track marketplace sales and direct sales separately so you know where your personal obligations begin.
Selling to Businesses for Resale
When your out-of-state customer is a business buying to resell rather than a consumer buying for their own use, the sale can be exempt entirely — but only with the right paperwork. The buyer must give you a resale certificate, and you must keep it on file. Without it, you’re on the hook for the uncollected tax.
The Multistate Tax Commission publishes a Uniform Sales and Use Tax Resale Certificate that many states accept for interstate B2B transactions. On that form, the buyer certifies their sales tax registration number, confirms the purchase is for resale in the normal course of business, and signs under penalties of perjury.6Multistate Tax Commission. Uniform Sales and Use Tax Resale Certificate – Multijurisdiction You’re expected to act in good faith. Accepting a certificate for goods the buyer obviously isn’t going to resell — office furniture for their own use, say — won’t hold up in an audit.
Not every state accepts the uniform form. A few require their own state-specific version. When a certificate arrives from an unfamiliar state, verify the buyer’s registration number through that state’s online portal if one exists. A certificate stays valid until the buyer cancels it in writing or the state revokes it, so a single one can cover a long-running relationship.
Documenting That the Goods Left Pennsylvania
Pennsylvania presumes every sale is taxable unless the seller proves otherwise. When you don’t collect PA tax because the shipment went out of state, you carry the burden of proof. The Department of Revenue expects documentation that the goods actually left the Commonwealth and reached an out-of-state destination. Useful records include bills of lading, carrier tracking confirmations, freight invoices listing the delivery address, and postal insurance receipts.
The shipping documents need to match your commercial invoices and purchase orders. If tracking data shows delivery to a Pennsylvania address while your invoice records the sale as out-of-state, that inconsistency will trigger an assessment. Digital delivery confirmations from carriers are generally sufficient, but they have to be organized and retrievable.
Pennsylvania requires businesses to keep these records for at least three years from the end of the calendar year they relate to.7Commonwealth of Pennsylvania. 61 Pa. Code 34.2 – Keeping of Records If you can’t produce shipping documentation during an audit, the Department will reclassify the sale as in-state and assess the 6% tax plus interest against you, not against your customer.
Registering in Another State
Once you cross a destination state’s economic nexus threshold, you have to register for a sales tax permit there before you can legally collect. Each state runs its own online portal through its Department of Revenue or Treasury. Expect to provide your business’s legal name, Federal Employer Identification Number, product types, and historical sales data for that state. Some states also ask for personal details of officers or partners, including Social Security numbers.
If you owe registration in multiple states, the Streamlined Sales Tax Registration System offers a single application covering all 24 participating member states.8Streamlined Sales Tax. Sales Tax Registration SSTRS There’s no fee to register through SST itself, though an individual state may charge a fee where one is legally required.9Streamlined Sales Tax. Registration FAQ Most states send registration and reporting information within 15 days of application. California, New York, Texas, and Florida are not SST members, so they require separate direct registration.
Before you register anywhere, check what that state actually taxes. Clothing may be exempt in one state and taxable in another, and groceries get different treatment almost everywhere. Getting the taxability decisions right at registration prevents you from over-collecting or under-collecting from your first sale forward.
What the Buyer Owes When You Don’t Collect
If you ship to an out-of-state customer and collect nothing — because you haven’t crossed that state’s threshold — the transaction isn’t necessarily tax-free for the buyer. Nearly every state with a sales tax also has a use tax at the same rate, and the buyer is technically responsible for paying it directly to their own state. Individual consumers rarely do. Business buyers are more likely to be audited for it. When a customer asks why you’re not charging tax, that’s the honest answer: tax may still be owed, just not by you.