Taxes placed on the sale or lease of goods and services in the United States are called sales taxes. Sales taxes are only charged at the final point of sale, so resellers and wholesalers are exempt from paying tax. Any merchant in the US needs to be sales tax compliant. This means that a retailer has to charge sales tax to buyers in states where he has sales tax nexus or physical or economic presence in other words.
US sales tax in X-Cart can be configured using one of the following add-ons:
- Sales Tax - an add-on for manual configuration of sales tax. Setting up sales tax in X-Cart 5 using this add-on takes time and effort, but the system provides enough flexibility to configure even the most intricate tax calculation rules. If necessary, you can set tax rates depending on the tax class of the products in the order, the customer’s address zone, and the customer’s membership level. See the Sales Tax add-on manual.
- AvaTax Sales Tax Automation - an add-on for integration with AvaTax, a sales tax automation service by Avalara. See the AvaTax Sales Tax Automation add-on manual.
- TaxJar Sales Tax Automation - an add-on for integration with TaxJar, a popular sales tax automation service in the US. See the TaxJar Sales Tax Automation add-on manual.
No matter whether you choose to configure your sales tax manually or use an automated solution, be sure to first consult your accountant or local tax authority on the tax requirements that apply to your online business. This is highly recommended to ensure you are charging tax properly for your store.
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