What is the $100,000 TPT threshold and what counts toward it?

Arizona's $100,000 economic nexus threshold is measured in gross proceeds (total sales revenue, not net) from sales delivered to Arizona addresses during the previous or current calendar year. Both taxable and exempt direct sales count toward the calculation. Sales made through marketplace facilitators that collect TPT on your behalf are excluded. Once you cross $100,000, you must register and begin collecting on the next sale.

How do I register for Arizona TPT once I have nexus?

Register through AZTaxes.gov (the Arizona Department of Revenue's online portal) using a TPT-2 application. You will need your federal EIN, business legal name, NAICS code, and bank information. The license fee is $12 per business location. Most remote sellers receive their TPT license number within 5-7 business days. After registration, you must collect TPT on all taxable Arizona sales going forward and file returns on the cadence ADOR assigns based on your projected tax liability.

What is the difference between TPT and sales tax?

TPT (Transaction Privilege Tax) is Arizona's version of sales tax. It's technically a tax on the seller for the privilege of doing business in Arizona, rather than a tax on the buyer. In practice, sellers pass the cost through to customers like sales tax, but the legal obligation to pay sits with the seller — meaning you remain liable for TPT even if you fail to collect it from the customer.

Is Arizona TPT origin-based or destination-based for remote sellers?

For remote sellers without physical presence in Arizona, TPT is destination-based — the tax rate is based on the customer's delivery address (state + county + city combined rate). For Arizona-based sellers with a physical location, TPT is origin-based for in-state sales, sourced to the seller's business location. This dual treatment is one reason Arizona TPT is more complex than typical state sales tax.

When do I have to start collecting Arizona TPT after crossing the threshold?

You must register and begin collecting TPT on the first day of the month following the month in which you exceed $100,000 in Arizona gross proceeds. Arizona Department of Revenue expects prompt registration — delays can result in personal liability for uncollected tax plus penalties and interest. If you're close to the threshold, monitor monthly and register proactively rather than waiting.

Arizona TPT Nexus Threshold: $100K Rule Explained (2026 Guide)

Arizona's Transaction Privilege Tax (TPT) economic nexus threshold is $100,000 in gross proceeds. This guide explains how the threshold works and what counts toward it.

Key Takeaways

• Threshold: $100,000 in gross proceeds
• Transaction threshold: None (removed in 2021)
• Measurement period: Previous or current calendar year
• Tax type: Transaction Privilege Tax (TPT)

Understanding Arizona's $100,000 Threshold

Arizona requires remote sellers to collect TPT when they exceed $100,000 in gross proceeds or gross income from sales delivered into Arizona. This threshold is straightforward—Arizona does not use a transaction count threshold.

The threshold is measured against the previous or current calendar year. If you exceeded $100,000 in either period, you have economic nexus.

What Counts Toward the Threshold

Gross proceeds from retail sales delivered to Arizona addresses
Sales through your own website or direct channels
Both taxable and exempt sales (for threshold calculation)

What Doesn't Count

Sales through marketplace facilitators (Amazon, eBay, etc.)
Wholesale sales with valid TPT exemption certificates

Remote Seller Tax Rates

As a remote seller without physical presence, you use destination-based sourcing. Calculate the combined state, county, and city rate for each customer's delivery address. Arizona's state rate is 5.6%, but combined rates vary significantly by city.

After You Cross the Threshold

Crossing $100,000 starts a clock: register, then file on the cadence the Arizona Department of Revenue assigns you. Arizona TPT returns are due by the 20th of the month following each reporting period — the Arizona TPT filing deadlines calendar has the 2026 dates, and Arizona TPT penalties covers what a late return or an unregistered month actually costs.

Sellers who trip Arizona's threshold usually trip others in the same year. Pennsylvania also uses a $100,000 revenue-only test and the same 20th-of-the-month due date, but assigns your filing frequency from third-quarter tax and adds an accelerated prepayment rule above $25,000 a quarter — see the Pennsylvania sales tax filing deadlines calendar, or compare every state side by side in the sales tax nexus thresholds by state chart.

Frequently Asked Questions

You have Arizona TPT economic nexus if your gross proceeds from sales delivered into Arizona exceeded $100,000 in the previous or current calendar year. Physical presence — an office, employee, inventory in an Arizona warehouse, or attending a trade show — also creates nexus regardless of revenue. Marketplace sales through Amazon, eBay, or Etsy do not count toward your $100,000 threshold because the marketplace facilitator collects on those sales.

Related Guides

Arizona TPT Nexus Guide

Complete overview of Arizona TPT nexus.

How to Register for Arizona TPT

Registration guide.

Arizona TPT Filing Deadlines

All due dates for 2026.

Georgia Sales Tax Nexus

Compare Arizona’s revenue-only threshold with Georgia’s revenue-or-transaction test.

Last Updated: January 15, 2026

Disclaimer: This information is provided for educational and informational purposes only and does not constitute tax, legal, or financial advice. Tax laws and regulations change frequently. While we strive to keep this information accurate and up-to-date, we make no representations or warranties of any kind about the completeness, accuracy, reliability, or suitability of this information. Please consult with a qualified tax professional or attorney for advice specific to your business situation. Always verify current requirements with the official state tax authority.