States With No Sales Tax: What Sellers Need to Know in 2026

States With No Sales Tax: What Sellers Need to Know in 2026

Five US states skip statewide sales tax entirely. If you're selling software, digital products, or SaaS to customers across the country, you've probably wondered which states give you a break and what it actually means for your business.

Short answer: the break is smaller than it looks, and the compliance math gets weirder, not simpler. Here's what every seller shipping in 2026 should know.

The 5 states with no sales tax

Memorize the acronym: NOMAD.

• New Hampshire
• Oregon
• Montana
• Alaska
• Delaware

These five states have no statewide general sales tax. A buyer in Portland, Oregon does not pay state sales tax on your $49 SaaS subscription. A buyer in Wilmington, Delaware doesn't either.

That's the headline. The fine print is where most sellers trip.

The Alaska asterisk

Alaska has no state sales tax, but it lets cities and boroughs charge their own. Juneau, Wasilla, Ketchikan, dozens of others run local sales tax rates between 1% and 7.5%.

If you sell into Alaska and hit the economic nexus threshold (currently $100,000 in sales or 200 transactions across the Alaska Remote Seller Sales Tax Commission jurisdictions), you have to register and remit to those local jurisdictions. One state, dozens of taxing authorities, one combined return.

So "no sales tax" is technically true at the state level, and technically false the moment you start scaling. Most sellers find this out the month they get a registration letter.

What "no sales tax" actually means for sellers

Three things matter:

1. No statewide collection obligation in those five states. You don't charge state sales tax on the invoice.
2. Local obligations still exist (Alaska is the big one, plus a handful of NH meal and rental taxes, MT lodging tax, etc.). These don't usually hit SaaS, but they hit anyone selling food, accommodation, or short-term rentals.
3. Your nexus footprint in the other 45 states is unchanged. Selling from Delaware doesn't get you out of California sales tax obligations once you cross their thresholds.

A lot of founders think "I'll incorporate in Delaware and skip sales tax." Incorporating somewhere doesn't change where you owe sales tax. Where your customers are is what matters. Economic nexus rules (post-Wayfair, 2018) are state-by-state and based on revenue or transaction volume into that state.

Why founders still care about NOMAD states

A few reasons NOMAD states show up in pricing strategy conversations:

• Customer pricing optics. A $99 plan stays $99 at checkout. No $107.43 surprise.
• Lower compliance overhead if your customer base happens to concentrate there (rare for SaaS, common for niche B2B serving Pacific Northwest or New England industries).
• No registration paperwork for those five states (Alaska local rules aside).

That's it. The savings are real but small for most digital sellers. The 45 other states are where the compliance cost actually lives.

The actual sales tax problem in 2026

Here's what makes US sales tax painful for software businesses:

• 45 states plus DC have economic nexus laws. Each one with its own threshold ($100K, $250K, or 200 transactions are common cuts).
• SaaS is taxable in roughly 20 states and the list keeps shifting (Texas, Washington, Pennsylvania, Tennessee, Iowa, etc.).
• Digital products are taxable in 30+ states, with rules that differ for streaming vs. downloads vs. SaaS vs. ebooks.
• Local jurisdictions add another 10,000+ taxing authorities layered on top of state rules.

You cross a threshold, you register, you collect, you file, you remit. Miss one and the state will eventually find you. Penalties compound. Audits go back three to four years.

This is the work most indie founders and small SaaS teams either ignore or pay a tax attorney $5K to set up and another $2K/month to maintain.

The Merchant of Record alternative

If you sell through a Merchant of Record like Creem, the MoR becomes the seller of record for tax purposes. That means:

• We collect and remit US sales tax across all 45+ states where it applies, automatically.
• You don't register anywhere yourself.
• The "states with no sales tax" question stops being relevant to your stack: a buyer in Delaware sees no tax, a buyer in California sees the right rate, all without you maintaining a nexus tracker.

Same applies to EU VAT, UK VAT, and 50+ other tax regimes globally. One integration, global tax handled. See pricing for what that actually costs (spoiler: a flat fee, no per-jurisdiction surcharge).

This is why MoR adoption among indie SaaS founders went vertical in 2025. The math is simple: paying 5% of revenue beats paying a tax attorney plus your own time to manage 45 state portals.

How to decide if NOMAD states matter for your business

Three questions:

1. Are most of your customers in NOMAD states? If yes (rare for SaaS, more common for regional services), the relief is meaningful. If your customer base looks like every other SaaS (skewed CA, NY, TX, FL), it's noise.
2. Are you near nexus thresholds in the other 45 states? If yes, your bottleneck isn't NOMAD states, it's the rest of the country. Start there.
3. Do you want to spend time on tax ops? If no, MoR. If yes, build a Stripe Tax + Avalara + accountant stack. Both work. Pick based on your bandwidth.

If you're a solo founder shipping fast, the MoR path saves you 40+ hours a quarter and removes a class of risk you'd otherwise be carrying personally.

FAQ

What states have no sales tax in 2026?

Five US states have no statewide sales tax: New Hampshire, Oregon, Montana, Alaska, and Delaware (the NOMAD states). Alaska allows local jurisdictions to charge sales tax of up to 7.5%, so it's only "no sales tax" at the state level.

Do I have to charge sales tax to customers in NOMAD states?

No, you don't charge statewide sales tax to customers in those five states. Alaska is the exception: if you exceed the Alaska Remote Seller Sales Tax Commission threshold (typically $100K in sales or 200 transactions), you must register and remit to participating local jurisdictions there.

Does incorporating in Delaware mean I can skip sales tax?

No. Where you incorporate has nothing to do with sales tax obligations. Sales tax is owed based on where your customers are located and whether you've crossed each state's economic nexus thresholds. Delaware C-corps are popular for legal reasons, not tax reasons.

Is SaaS taxable in states with no sales tax?

SaaS is not taxable in Oregon, Montana, New Hampshire, or Delaware (no state sales tax to begin with). In Alaska, it depends on the specific local jurisdiction's rules. In the other 45 states, SaaS taxability varies, with about 20 states currently taxing SaaS.

How does a Merchant of Record handle sales tax?

A Merchant of Record (MoR) becomes the legal seller for tax purposes. The MoR handles registration, collection, filing, and remittance across all US states (and globally, for VAT and other regimes). You don't manage nexus, file returns, or track thresholds. See the Creem docs for how the integration works.

Want to stop tracking sales tax thresholds by hand? Start with Creem and ship to all 50 states (NOMAD or not) with one integration.