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TOPIC: California Sales Tax

California Sales Tax #2844

  • Dena10
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Our company now has to charge California Sales Tax. Being that were are about 13 tax rates, does anyone know of an easy way to do this? I could add 13 different codes but wasn't sure if anyone else had any ideas.
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California Sales Tax #2845

  • dgillz
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Macola uses Tax Schedules and Tax Details. CA has considerably more than 13 taxes - so do most other states. A Tax Schedule is made up of one or more Tax Details. For example, the components of the sales tax you are going to charge are the Tax Details (percentages are for example only I do not know the actual tax rates):

State of CA Tax 6.0%
Orange County Tax 1.75%
City of Santa Ana Tax 0.5%

So you would create 3 tax details as above. Then a tax schedule that combines the 3 tax details. Create tax details for every county, city and special district tax that you have to charge. The city of Anaheim, also in Orange County, may or may not have the same city tax rate, but you should create a tax detail for it anyway. Then create all the relevant tax schedules and assign them to all of your CA customers/Ship to addresses.

If Orange County or the State, or the Municipality changes it's tax rate, you have to change 1 tax detail, not 100s of customers and/or open orders. This is why you create a separate tax detail for EVERY city, even if the tax rates are the same.

There are also special district taxes which only apply to certain zip codes within a multiple zip-code city. Again, add a tax detail and create the applicable tax schedule.

Pro Tip: Make EVERY customer taxable, then create tax details with a zero tax percentage if they are not taxable, one for EACH REASON the sale is not taxable. For example Resale, Federal Government, Out of State are all not taxable for various reasons.

If this is setup properly, your sales tax returns will be a snap.

You can add these same tax schedules to your vendors/taxable purchases, and the tax will calculate for you.

If this is too much to handle manually, talk to Exact or your reseller about the Avalara Tax solution.

Let me know if you have any questions.
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