Sales Tax 101 States

Which states require an annual sales tax reconciliation?

by Jennifer Dunn

Rhode Island, Michigan and Hawaii annual sales tax reconciliation

At this point, most eCommerce companies are accustomed to periodically filing sales tax returns. And in most states, sales tax returns are generally due monthly, quarterly or annually.

However, a handful of states take sales tax filing even further and require that businesses file an annual reconciliation. 

States that Require Annual Sales Tax Reconciliations

As of this writing, only three states require annual sales tax reconciliations.

In general, these reconciliations are “annual check ins” with the state’s taxing authority. Each state has their own reason for requiring this annual reconciliation, which we detail below. 

Hawaii

Why Hawaii requires an annual general excise tax (their version of sales tax) reconciliation is a bit of a mystery. Unlike the other states with the same requirement, Hawaii doesn’t ask for any new information from taxpayers.

Hawaii publishes form G-49 for annual general excise tax reconciliation. You can also file this form at Hawaii Tax Online. Or, just let TaxJar AutoFile handle your Hawaii  annual sales tax reconciliation.

Michigan

Michigan does not require that sales tax filers categorize deductions on their monthly or quarterly returns, so they require this on their annual reconciliation.

Michigan publishes fillable tax forms, including for 5081 for  annual sales tax reconciliation, here. Taxpayers can also file online at Michigan Treasury Online. Or, just let TaxJar AutoFile handle your annual sales tax reconciliation in Michigan.

Rhode Island

On top of regular sales tax filings, all Rhode Island sales tax filers are required to file a yearly sales tax reconciliation in January. Because Rhode Island only accepts a monthly or quarterly payment amount, they require annual sales and deductions to be reported on the annual reconciliation. Rhode Island considers this an “annual report” for sales tax filers

Rhode Island will post a fillable PDF form T-204 here, or businesses who already file online can file their Rhode Island annual sales tax reconciliation here. Or if you’d rather not deal with an “extra” sale tax filing at all, TaxJar AutoFile will file all of your Rhode Island sales tax, including annual reconciliations, for you.

Does TaxJar handle my annual sales tax reconciliations?

Yes. TaxJar AutoFile handles annual sales tax reconciliation in states that require it as a normal part of AutoFile. Ready to enroll in AutoFile and take annual sales tax off your plate? Learn more about signing up for TaxJar AutoFile here.

Ready to automate sales tax? To learn more about TaxJar and get started, visit TaxJar.com/how-it-works

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