Magento TaxJar

Sales Tax Automation Comes to Magento

by Mark Faggiano

magento sales tax extensionOur quest to make sales tax simpler for small business continues. Today we released Sales Tax Automation – the simplest way to collect sales tax and get automated sales tax reporting for US-based Magento store owners.

What are the Benefits to Sales Tax Automation?
First, Magento users asked us for an easier way to collect sales tax and track what they’ve collected (so that filing returns becomes easier). Second, they were tired of using other solutions that call another server to get tax rates, thus slowing down the checkout process. Who could blame them? Customers who experience poor performance or a confusing checkout process are less likely to make the purchase. That means lost revenue. Sales Tax Automation solves both requests – easier collection, tracking, and no calls to other servers for rates. It’s just fast and it works.

Automated Configuration
We worked closely with Magento store owners to make sure we delivered what they needed the most. Easy installation was at the top of the list. Sales Tax Automation eliminates the need to figure out if your state charges sales tax based on your location or the location of your customer. Same for taxability of shipping. That’s all taken care of automatically for you for FREE. All a store owner has to do is enter in TaxJar API Token that’s easily accessible from their TaxJar account. See what easy installation and automated configuration looks like below.

sales tax automation for magentoSales Tax Rates
After the API Token is entered, Sales Tax Automation provides tax rates for every zip code in any states where you have sales tax nexus, for FREE, right out-of-the-box. Check out the screenshot below for a seller based in New York.

magento sales tax

Clever for California Businesses
Not all states agree on how sales tax should be charged. Some states base it on the point of origin. Others base it on the the destination where the item is being shipped. California is unique. It’s a modified origin state which means sellers are allowed to collect two different sales tax rates (a local rate for customers in their district and the state rate for customers outside their district). Sounds like a nightmare, but it’s not a problem for Sales Tax Automation. If you’re a California-based seller, our automated configuration sets up tax collection exactly how it should be in the Golden State.

New Integration. Same Great Reporting.
What’s great for Magento store owners is TaxJar already makes it simple to track sales tax being collected through the extension. Just ask the sellers on Amazon, Etsy, Shopify, Bigcommerce, or eBay who already love the way our automated reports give them the level of detail they need to file sales tax returns in minutes instead of hours – sales and taxes collected by county, city, and special jurisdictions.

sales tax reporting for magento

What’s Does Sales Tax Automation Cost?
The extension is free to install. When you install you get tax rates for every zip code in the state where you have sales tax nexus. If you want to get updated rates (we update rates automatically at the beginning of each month) or if your want to use our automated reporting feature, then pricing begins at $19/per month.

As always, we want to hear from you. Let us know what you think of Sales Tax Automation. Look for more announcements coming soon.

Update: Need to collect sales tax from buyers in multiple states? Sales Tax Automation for Magento now supports multi-state nexus.  Find out more in our multi-state nexus blog post.

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  • At the bottom of your Magento Module Page it says this: *Magento stores do not support multi-state sales tax collection. — Does this mean that we can’t use your module if we collection sales tax in more than one state? We currently do collect sales tax in more than one state and we use Magento.

    • Hi Isaac – Correct. Magento does not allow for multi-state collection sales tax out-of-the-box.

      • That’s strange because we have a stock 1.6.2 Magento install and under Sales –> Tax –> Manage Tax Zones and Rates we just created a taxable and non taxable rate for each state where we charge tax. We don’t have exact tax rates in there but it works for both states and presumable would work by adding in all of the zip codes and the correct rates. http://i.imgur.com/ppP2QA3.png We were looking at TaxJar but if we can’t collect for 2 states then it just wont work. Suggestions?

        • You might be able to put in the rates. But, important factors like origin versus destination and shipping taxability are global settings. So, in effect, you can only accurately support one state.

  • C

    I am happy to see the Tax is issue is on it’s way to being solved in Magento. I do have a question though. Will TaxJar calculate taxes by county? Ohio collects by county, but Magento assigns tax by ZIP, this would be fine except Ohio has multiple ZIPs that span more than one county. Is there a solution for this? Thanks

  • Hi C,

    Ohio is origin-based and tax rate determination is based on your business address within Ohio and we take into account all county, state, city, and special tax rates that apply. The rate imported into your Magento installation will take everything neccessary into account. I hope this helps.

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