Tax nexus is the connection between your business and a U.S. state (or the U.S. itself) that is strong enough to trigger a tax-filing or tax-collection obligation there. It can be physical (an office, employees, inventory) or economic (enough sales or transactions into the state).
How tax nexus works
Nexus comes in two main forms.
Physical nexus is the old rule: a presence in a state, such as an office, staff, a warehouse, or stored inventory, creates an obligation there. Economic nexus is newer. After the Supreme Court's 2018 decision in *South Dakota v. Wayfair*, states can require an out-of-state seller to collect sales tax once it crosses a sales or transaction threshold, even with no physical footprint. Many states set that line at $100,000 in sales or 200 transactions per year, though the exact thresholds vary by state.
Once nexus exists, you may owe income tax, sales tax, or both in that state.
Why it matters for a global or India-based founder
If you run a U.S. entity from abroad, nexus decides where you have to file, not just whether you owe federal tax.
A foreign-owned U.S. LLC already has federal reporting duties, including Form 5472 plus a pro forma 1120 filed annually even with zero activity, with a $25,000 penalty for missing it. Nexus is a separate, state-level question: selling into customers across many states, holding inventory in a fulfillment center, or hiring U.S. contractors can create filing obligations in states you have never visited. Mapping your nexus early keeps a fast-growing business from accumulating quiet liabilities in a dozen states at once.
Nexus is about your tax footprint; getting set up to operate at all still starts with an entity and an EIN.
Where StableCorp fits
StableCorp handles the foundation that sits underneath any nexus question: forming your Wyoming LLC or Delaware C-Corp, getting your EIN, opening a U.S. business bank account, and giving you compliant rails to get paid in USD and USDC, then off-ramp to INR through proper RBI purpose codes rather than a grey-area direct-wallet path.
That clean structure and paper trail is exactly what makes multi-state and cross-border tax questions tractable. See pricing for what setup and ongoing compliance cost.
This is general information, not tax advice. State nexus thresholds change, so confirm current rules with a qualified advisor.
Sources
U.S. Supreme Court — South Dakota v. Wayfair, Inc. (2018) — https://www.supremecourt.gov/opinions/17pdf/17-494_j4el.pdf
IRS — Instructions for Form 5472 — https://www.irs.gov/instructions/i5472