What is Tennessee's e-commerce sales tax in 2026?

Tennessee's 2026 e-commerce sales tax: out-of-state sellers collect once they cross $100,000 in Tennessee-destination revenue. Charge the 7.00% state rate plus any applicable local rate at the buyer's ship-to address.

Do I collect sales tax on every Tennessee order?

You collect Tennessee sales tax once you cross the economic nexus threshold ($100,000). Below threshold, you don't need to collect unless you have physical nexus (office, employees, inventory in Tennessee).

What rate do I charge for Tennessee e-commerce sales?

7.00% state rate, plus any applicable local rate at the customer's ship-to address. Most e-commerce platforms (Shopify, WooCommerce) can apply destination rates automatically when you enable TN in tax settings.

Do I need to collect sales tax on shipping in Tennessee?

It depends on state-specific rules. Many states tax shipping when the product is taxable; some states exempt shipping if separately stated. Check Tennessee's specific policy or use a tax service that encodes the rule.

Tennessee E-commerce Sales Tax Nexus Guide — 2026

Updated 2026-05-27

If your E-commerce business sells $100,000 into Tennessee in a calendar year, you have economic nexus and must register, collect, and remit Tennessee sales tax.

E-commerce sales tax basics in Tennessee

For a direct-to-consumer store (Shopify, WooCommerce, BigCommerce, or custom) shipping to Tennessee buyers, the economic nexus trigger is $100,000 in TN-destination revenue (effective 2020-10-01). Crossing that bar obligates registration, collection, and periodic filing.

Once registered, charge 7.00% state tax plus the applicable local rate — averaging 2.61% across Tennessee but varying by the buyer's shipping ZIP on most tangible personal property. Digital products, subscriptions, and professional services have different treatment — see the Tennessee SaaS page if you sell software or digital goods.

Registration + collection checklist

Register with the Tennessee Department of Revenue for a sales tax permit.
Configure your cart platform to collect tax at the destination rate. Enable TN in your tax settings.
Charge the combined state + local rate at the customer's delivery address (most states source to ship-to, not ship-from).
File returns on the cadence your DOR assigns (monthly, quarterly, or annually).
Track your Tennessee-sourced revenue monthly so you know when you're approaching or below threshold for the next period.

Common mistakes e-commerce sellers make in Tennessee

Using origin-based rates (your HQ state's rate) instead of destination rates. Tennessee sources to the buyer's ship-to address — charge the TN rate, not your home state's.
Counting marketplace sales toward the Tennessee threshold. Amazon, Etsy, and eBay sales are usually excluded in Tennessee; check the specific rule before adding them to your nexus-tracking spreadsheet.
Waiting until year-end to register. If you cross $100,000 mid-year, you must begin collecting on sales made after the threshold-crossing date — back-tax exposure grows until you register.
Forgetting to file zero returns once registered. Missing filings trigger penalties even when you owe no tax.

Tennessee nexus note

Economic nexus in Tennessee triggers at $100,000 in gross sales delivered into Tennessee in the current or prior calendar year. No transaction count threshold.

What to do next

Read the full Tennessee overview for thresholds, filing frequency, marketplace facilitator rules, and registration links. Use the nexus calculator to check whether you have crossed the threshold. For background on the post-Wayfair economic nexus framework, see the pillar guide.

Frequently asked questions

What is Tennessee's e-commerce sales tax in 2026?: Tennessee's 2026 e-commerce sales tax: out-of-state sellers collect once they cross $100,000 in Tennessee-destination revenue. Charge the 7.00% state rate plus any applicable local rate at the buyer's ship-to address.
Do I collect sales tax on every Tennessee order?: You collect Tennessee sales tax once you cross the economic nexus threshold ($100,000). Below threshold, you don't need to collect unless you have physical nexus (office, employees, inventory in Tennessee).
What rate do I charge for Tennessee e-commerce sales?: 7.00% state rate, plus any applicable local rate at the customer's ship-to address. Most e-commerce platforms (Shopify, WooCommerce) can apply destination rates automatically when you enable TN in tax settings.
Do I need to collect sales tax on shipping in Tennessee?: It depends on state-specific rules. Many states tax shipping when the product is taxable; some states exempt shipping if separately stated. Check Tennessee's specific policy or use a tax service that encodes the rule.

Sources

date_retrieved: 2026-05-27