Harbor Supply Co. sells nationwide, and the first time this becomes a sales tax problem is usually not a policy meeting. It is an invoice that went out without tax, a customer disputing a rate, or a state notice asking why returns were never filed. For 2026, the practical starting point is a footprint list that tells us which states need attention now and what the baseline state rate layer is in each.
HSC’s case facts give us enough to start a footprint. HSC has direct web sales into TX $420,000, CA $560,000, NY $520,000 across 120 invoices, FL $140,000, IL $95,000, and CO $110,000. HSC also has marketplace sales into CA $180,000, FL $60,000, and WA $90,000, plus physical touchpoints that often create nexus such as an HQ in Dallas TX, a warehouse in Reno NV, and two CA repair technicians. Inventory is stored in CA and TX by a marketplace, and HSC has purchases that create use tax exposure such as packaging from a TX vendor $36,000, a software subscription $48,000, and tools shipped to CA $22,000.
A footprint is a working checklist, not a conclusion. It combines what we sold, where we have people or inventory, and where we buy without tax, so we can decide where to register, where to collect, where to accrue use tax, and what data we need to prove exemptions. Put these facts into a first-pass footprint for TX, CA, NY, FL, IL, CO, and WA here:
That footprint also needs a simple rate orientation layer, because even before we solve taxability or exemptions, returns and reconciliations depend on knowing the state component that sits under every combined rate. Using the July 1, 2026 midyear snapshot, the state only sales tax rates for our target states are TX 6.25%, CA 7.25%, NY 4.00%, FL 6.00%, IL 6.25%, CO 2.90%, and WA 6.50%. These figures are state layers only, and many states also permit local add on sales taxes that change the actual rate charged on an invoice.
When a customer in Texas places a $10,000 order, a common first draft is to compute sales tax as $10,000 × 6.25% = $625 using the Texas state rate. That number can still be wrong on a real invoice because Texas allows local jurisdictions to add their own rate on top of the 6.25% state layer, and the local piece depends on where the customer takes delivery. The state rate answers part of the question, but the invoice requires a jurisdiction level lookup keyed to the ship to address.
The operational decision is whether we are using a state only estimate for budgeting or a combined rate for billing and filing. For budgeting, the Texas population weighted average local rate is 1.95% as of July 1, 2026, which implies an average combined rate of 8.20%. For billing, even that combined average is still only an estimate, because local rates can vary up to a 2.00% maximum local layer in Texas as of that same date. Pick which rate belongs in each context, then reveal the reasoning: