What is trailing nexus?

Most states make you keep filing for a while after you drop below their threshold. California runs through the next full calendar year. Texas uses a rolling twelve months. We track each state's rule so you cancel on the right date, not too early.

Will I get in trouble for canceling a permit?

Not if you do it in the right order. We file every outstanding and final return first, then guide the cancellation. The real risk is canceling early or skipping a final return, which is exactly what we prevent.

Which platforms do you support?

Amazon, Shopify and WooCommerce, with BigCommerce, Etsy, Walmart and eBay supported through manual entry. You can also enter your states by hand on any platform.

Do you file my returns?

Yes. During the wind-down we file the zero-dollar returns so nothing lapses, and once you're deregistered in a state there's nothing left to file.

How is this different from Avalara or TaxJar?

They help you register and file more. We help you deregister and file less. We only charge for the states you keep.

No. TrailingZero is software that flags deregistration opportunities and handles filings. For complex situations we tell you when to bring in your accountant.

Is TrailingZero live?

Yes. Free audits are live now — run yours in minutes. Connect a store read-only or enter your registered states by hand to see which you can cancel and what it saves.

What's the economic nexus threshold in Michigan?

Michigan uses $100,000 in sales or 200 transactions (previous calendar year (January 1 – December 31)). Under it, with no physical presence, you generally don't have economic nexus.

No. This page is general education built from public sources and the rules change often. Confirm your specific situation with the state's tax authority or your accountant before you register or deregister.

Deregistration guide

Can I cancel my sales tax registration in Michigan?

If you registered for a sales tax permit in Michigan to be safe and most of your returns now read $0, you may be paying to file in a state you no longer owe. Here's when you can cancel in Michigan — and how to do it without tripping a penalty.

By John DoeReviewed by Jane Doe, CPAUpdated June 2026How we verify

Can you deregister below threshold?: Yes, after trailing nexus
Trailing-nexus window: ≈ 12 months
Final return required: Yes
How to cancel: the online portal or form 163
Tax authority: Michigan Department of Treasury

Source: State trailing-nexus rule

Short answer

Yes — once your nexus has genuinely ended. Canceling your Michigan sales tax registration makes sense once a full calendar year has passed in which your sales into the state fell below both $100,000 in gross revenue AND 200 transactions — at that point you can close the account effective January 1 of the following year and stop filing. The key catch is the trailing obligation: if you dropped below thresholds in 2025, you must still file and collect throughout all of 2025 before canceling on January 1, 2026, so deregistering too early creates back-tax liability.

Nexus & savings calculator

Estimate whether you still have nexus in Michigan — and what canceling could save.

State

Annual sales into Michigan

Transactions (orders) per year

I have physical presence hereFBA/3PL inventory, an employee, or an office in Michigan

Filing frequency

Cost per return

Physical presence
Sales over $100,000
Over 200 transactions

Still has nexus

You likely still have nexus in Michigan because of more than 200 transactions — Michigan still counts transactions. Keep filing here for now.

Trailing nexus: Michigan applies trailing nexus — expect to keep filing for roughly 12 months after your nexus ends. Confirm the exact window before canceling.

Filing cost here today

$600/ yr

Read the Michigan guide →

Estimate only — general education, not tax advice. Confirm with Michigan's tax authority before you register or deregister.

Do you still have nexus in Michigan?

You can only cancel once your obligation has ended. Two things create it: physical presence (inventory, an employee, an office) and economic nexus (crossing $100,000 in sales or 200 transactions).

For Amazon FBA and 3PL sellers the sneaky one is physical nexus: storing inventory in Michigan creates it. Storing inventory in Michigan (e.g., Amazon FBA fulfillment centers) creates physical nexus immediately with no minimum sales threshold. If that inventory has since left the state, your physical nexus may have already ended even though the registration is still open.

Trailing nexus in Michigan

For economic nexus: a remote seller must continue collecting and remitting Michigan sales tax until an entire calendar year passes in which it does not meet either the $100,000 sales threshold OR the 200-transaction threshold. If a seller exceeds thresholds in Year 1 and falls below in Year 2, it must still collect throughout all of Year 2, but may cease collection and deregister effective January 1 of Year 3. For physical nexus: nexus continues for the remainder of the month nexus ceases plus the following 11 months.

Seller must file all required returns through the end of the trailing period and file a final return before cancellation. Form 163 (Notice of Change or Discontinuance) must be submitted to formally close the account.

How to cancel your Michigan sales tax permit

Confirm both your physical and economic nexus in Michigan have actually ended.
Work through Michigan's trailing-nexus window and keep filing (even $0 returns) until it closes.
File any outstanding returns and the final return (163), marking it final.
Close the account via the online portal or form 163.
Keep your records; states can review a closed account for several years.

Where TrailingZero fits

TrailingZero connects to your store read-only, maps where you actually have nexus state by state, and computes the exact date you can deregister in Michigan after trailing nexus. During any wind-down it can file the zero-dollar returns so nothing lapses — and you only pay for the states you genuinely keep. Run a free audit anytime; this page is free education either way.

Michigan Can I cancel FAQ

Can I get in trouble for canceling my Michigan sales tax permit?: Not if you do it in the right order. The risk comes from canceling before Michigan's trailing-nexus window ends or skipping a final return. Seller must file all required returns through the end of the trailing period and file a final return before cancellation. Form 163 (Notice of Change or Discontinuance) must be submitted to formally close the account.
Do I have to keep filing in Michigan after I stop selling there?: Usually yes, for a while. For economic nexus: a remote seller must continue collecting and remitting Michigan sales tax until an entire calendar year passes in which it does not meet either the $100,000 sales threshold OR the 200-transaction threshold. If a seller exceeds thresholds in Year 1 and falls below in Year 2, it must still collect throughout all of Year 2, but may cease collection and deregister effective January 1 of Year 3.
What's the economic nexus threshold in Michigan?: Michigan uses $100,000 in sales or 200 transactions (previous calendar year (January 1 – December 31)). Under it, with no physical presence, you generally don't have economic nexus.
Is this tax advice?: No. This page is general education built from public sources and the rules change often. Confirm your specific situation with the state's tax authority or your accountant before you register or deregister.

See what you can stop paying in Michigan

Run a free audit and see which registrations you can drop — in minutes, no card required.

Start free →Free audit · no card required.

Other states

See all states →

Sources

Primary sources reviewed for this page. Data current as of June 2026.

TrailingZerois software, not a CPA or law firm, and this page is general education — not tax or legal advice. State rules and thresholds change frequently; confirm your situation with the state's tax authority or your accountant before you register or deregister. See how we research and review this data in our editorial & accuracy policy.