Here are three updates you’ll want to know about right now:
Washington’s 10% Tax on Digital Marketing Spend (SB 5814)
If you’re running ads on platforms like Meta, Google, or TikTok and your billing address is in Washington state, listen up! A law enacting a 6.5% (plus a local %) tax on digital advertising spend is now in play. That means if you’re spending $20K/month on ads, that’s potentially an extra $2K in tax costs. This could affect your ad budgets and ROI calculations, so make sure you factor this into your financial planning. This should only impact you if you have a billing address in Washington State.
Texas Expands Sales Tax to SMS Marketing (SB 140)
Text message marketing isn’t just powerful—it’s now taxable (in Texas). Under SB 140, SMS marketing services are being treated as taxable “data processing.” Translation: if you’re using SMS platforms to drive sales, expect sales tax charges to show up on your invoices. This should only impact you if you have a billing address in Texas.
Texas Franchise Tax Crackdown
Texas is turning up the heat on franchise tax compliance. Many ecom businesses that thought they were “under the radar” are now getting notices. Even if your business isn’t profitable, you still may need to file a No Tax Due report—or risk penalties. The state is using new data tools to cross-reference LLCs, so it’s harder than ever to fly under the radar. We’ve noticed them getting specifically aggressive with any of our clients that are registered for sales tax in Texas. This will almost definitely impact you if you are registered for sales tax in Texas.
