Must an out-of-state mail-order business with no offices, employees or agents in New York — soliciting only by catalog — register as a vendor and collect New York sales tax?

Plain-English summary

Spiegel, Inc., an Illinois mail-order retailer, asked whether it had to register as a New York vendor and collect New York sales and use tax. Its only connection to New York was mailing catalogs and delivering merchandise by mail or common carrier — it had no place of business, employees, salespeople, independent contractors, agents or other representatives in the State, took its orders in Illinois and Pennsylvania, and filled them from an Illinois warehouse.

On those facts, the Department held Spiegel had no duty to register or collect.

• No "place of business" in New York. A vendor maintains a place of business only if it (directly or through a subsidiary) has a store, warehouse, office or similar facility in the State (20 NYCRR 526.10(c)). Spiegel and its subsidiaries had none.
• No "soliciting business" in New York. Soliciting means having people soliciting customers in the State, or distributing catalogs/advertising in the State, or advertising in New York media and directing orders to a New York address (20 NYCRR 526.10(d)). Distributing catalogs by interstate mail and delivering by mail/carrier is not soliciting business in New York.
• Not required to register; therefore no collection duty. A person who solicits only by interstate catalog distribution and delivers by mail or common carrier is not required to register as a vendor (20 NYCRR 526.10(e)(2)). If Spiegel did not remain registered, it would not be a "person required to collect tax" under § 1131(1) and would have no obligation under § 1132 to collect New York sales or use tax on its sales to New York residents.

This 1981 rule no longer controls. The opinion states pre-Quill, physical-presence nexus law. The U.S. Supreme Court's decision in South Dakota v. Wayfair, Inc. (2018) overruled the physical-presence requirement, and New York now imposes an economic-nexus collection duty on out-of-state sellers that exceed statutory sales and transaction thresholds — meaning a catalog-only or online seller with no New York physical presence can be required to collect New York tax today.

What this means for you

Don't rely on this opinion for a modern e-commerce or catalog business. In 1981, "no physical presence in New York" meant "no duty to collect." That is no longer the law. If you sell into New York from out of state, the deciding question today is usually your sales volume and transaction count, not whether you have an office or warehouse here.

It still shows how physical-presence nexus worked. The opinion is a clean illustration of the old framework — place of business plus solicitation — that governed before Wayfair. It's useful history for understanding pre-2018 disputes, but not a safe harbor going forward.

When in doubt, check the current economic-nexus thresholds. Out-of-state sellers should measure their New York sales against the State's current dollar and transaction thresholds and register if they exceed them, regardless of physical presence. This is exactly the kind of "does the old rule still apply to me?" question where current guidance — not a 1981 opinion — controls.

Common questions

Q: We sell into New York from out of state with no office here — do we owe New York tax collection?
A: Under this 1981 opinion, no. But that rule was overturned by South Dakota v. Wayfair (2018); New York now requires many out-of-state sellers to collect based on sales volume alone. Check the current economic-nexus thresholds.

Q: What made the seller exempt from registration in 1981?
A: It had no place of business in New York (20 NYCRR 526.10(c)) and did not solicit business in New York (526.10(d)) — its only contacts were interstate catalog mailings and mail/carrier delivery — so it wasn't required to register (526.10(e)(2)).

Q: Can I still rely on this opinion?
A: No. Beyond binding only Spiegel on its own facts, the legal rule it applies has been superseded. Treat it as historical background, not current authority.

Citations and references

Statutes, regulations and authority:

• Tax Law § 1131(1) — "person required to collect tax"; § 1132 — obligation to collect sales/use tax
• 20 NYCRR 526.10(c) — maintaining a place of business; 526.10(d) — soliciting business; 526.10(e)(2) — interstate catalog seller not required to register
• Superseding law (not cited in the opinion): South Dakota v. Wayfair, Inc., 585 U.S. 162 (2018), and New York's economic-nexus provisions

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1981.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a81_26s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-81(26)S
Sales Tax
September 24, 1981

STATE OF NEW YORK
STATE TAX COMMISSION
ADVISORY OPINION

PETITION NO. S810521A

On May 21, 1981, a Petition for Advisory Opinion was received from Spiegel, Inc., 1515
West 22nd Street, Oak Brook, Illinois 60521.
The issue raised is whether or not a mail order business located outside New York State is
required to register as a vendor and collect and remit sales and compensating use taxes.
Petitioner, Spiegel, Inc., is a mail order business located outside New York State. Petitioner
maintains no place of business, has no employees, salesmen, independent contractors, promotion
men, missionary men, service representatives, agents or other representatives in New York State.
Petitioner solicits sales from potential customers solely by distribution of catalogs. Customers' orders
for merchandise are received by telephone or mail. Mail orders are accepted in Illinois, and telephone
orders in Pennsylvania. All orders for merchandise are filled from Petitioner's warehouse in Illinois
and deliveries are made by common carrier or mail. Petitioner does not engage in the servicing of
merchandise sold.
Petitioner has several tiers of subsidiaries, none of which maintain a places of business in
New York State. Petitioner is a subsidiary of Beneficial Corporation whose activities are wholly
unrelated to those of Petitioner.
The Sales and Use Tax Regulations provide the following definitions of "vendor", applicable herein:
"A person making sales to his customers within the State, who has solicited such sales by the
interstate distribution of catalogs or other advertising material by mail and who delivers the
merchandise through the mail or by common carrier, and who neither maintains a place of business
as defined in subdivision (c) of this section, nor solicits business as defined in subdivision (d) of this
section, is not required to register as a vendor. However, if such person registers voluntarily, he is
under the same obligations as any other vendor." 20 NYCRR 526.10(e) (2).
"A vendor shall be considered to maintain a place of business in the State if he, either directly
or through a subsidiary, has a store, salesroom, sample room, showroom, distribution center,
warehouse, service center, factory, credit and collection office, administrative office or research
facility in the State." 20 NYCRR 526.10(c).
"(1) A person is deemed to be soliciting business if he has employees, salesman, independent
contractors, promotion men, missionary men, service representatives or agents soliciting potential
customers in the State."

JAMES H. TULLY., COMMISSIONER
TP-8 (4/80)

LOUIS M. JACOBSON, DEPUTY COMMISSIONER
FRANK J. PUCCIA, DIRECTOR

-2­
TSB-A-81(26)S
Sales Tax
September 24, 1981

"(2) A person is deemed to be soliciting business in New York if he distributes catalogs or
other advertising material, in any manner in the State.
"(3) A person is deemed to be soliciting business if he places advertisements in New York
newspapers or over New York radio or television stations, and either requests that orders, payments
or inquiries be sent to a New York address or delivers orders to New York in vehicles that he
controls." 20 NYCRR 526.10(d).
Petitioner solicits sales in New York solely by the interstate distribution of catalogs by mail.
Petitioner delivers merchandise to New York customers by common carrier or mail. Neither
Petitioner nor its subsidiaries maintain offices or facilities of any kind in New York. Petitioner,
therefore, does not maintain a place of business in New York within the meaning of 20 NYCRR
526.10(c). Petitioner does not retain any individuals in New York to solicit customers. Petitioner
does not request that orders, payments or inquiries be sent to a New York address. Petitioner,
therefore, does not solicit business in New York within the meaning of 20 NYCRR 526.10(d).
It follows from the above that Petitioner is not required to continue to register as a vendor.
20 NYCRR 526.10(e)(2). If Petitioner does not remain registered as a vendor, it will not be a person
required to collect tax within the meaning of the Tax Law. Section 1131(1). In such circumstance
Petitioner will not be obligated under Section 1132 of the Tax Law to collect sales or compensating
use taxes on its sales to New York residents.

DATED: August 31, 1981

s/LOUIS ETLINGER
Deputy Director
Technical Services Bureau