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California nexus for doing business

samh1986

First of all thank you in advance for your participation and help

I know for tax issues everyone will tell me to hire accountant, am just here to discuss it and share experience with others in California

My business in single member LLC in Montana, am not UC citizen and not a US resident

Am doing online selling as drop shipping, I sell on my website and on marketplaces

I don't have any physical existence in California, but I buy my products from a wholesale platform ONLY after the product is sold, I don't hold any inventory and do not have any agent contact with the suppliers in California and they control all their operations from pricing, inventory management and shipping


My question here

1- this scenario create physical nexus in California?

2- when I sell to customers in California, any sale is for profit making, in this case I hit economic nexus according to the first rule? or I must hit the threshold in the third rule?


here are California rules

Doing business in California

If you are doing business in California, you are subject to our tax laws.

1- We consider you to be “doing business” if you meet any of the following:

2- Engage in any transaction for the purpose of financial gain within California

3- Are organized or commercially domiciled in California

Your California sales, property or payroll exceed the following amounts: CA sales exceed (either the threshold amount or 25% of total sales) 2025 $757,070

See also