Sales tax can be a pain to deal with.
With stacks of paperwork, hefty amounts of calculations, and lots of challenging obstacles, it’s no wonder why sales tax compliance is one of the most difficult business processes. But you may be surprised to find there’s an easier way out of it. TaxJar is a cloud-based, state-of the-art automated sales tax platform.
TaxJar makes it easy to simplify the complex world of sales tax, giving your business an edge. In this review, we’ll take you through all the things you need to know about this service. We will also discuss the pros and cons of TaxJar and give our final verdict on whether TaxJar is worth it for your business management system. Let’s go!
For those of you who prefer a more visual experience, here is a video review from Marcus Stonelius’ YouTube channel. To get a comprehensive overview of TaxJar, you may still want to check out our article below.
What does TaxJar do? Npm Taxjar
TaxJar was established in 2013 to serve online sellers and business entities. Its goal is to simplify the complex process of sales tax compliance. The United States has over 11,000 tax jurisdictions, each of which has different rules depending on the district or state. Businesses had to adhere to sales tax regulations back then. Rates were determined by where transactions were made, inventory stock locations, and the number of employees they employed.
This process may appear simple on a surface level, but in reality, it’s quite complicated. Companies were given different tax burdens to handle, which can vary depending on various factors. The US Supreme Court in 2018 ruled that all businesses have to pay sales tax regardless of where the product was purchased. This resulted in more burdens for business owners, having to learn and memorize tax codes upon tax codes on top of everything else.
It’s a lot to take, right? Well, TaxJar takes most of the complications in sales tax compliances and turns them into simple, less daunting tasks. That way, you can prioritize what matters the most with your business, without the added hassles of hefty tax computation.
What are its Pros and Cons
We’ve compiled a list of pros & cons to help you make a decision about whether TaxJar is right for you. Npm Taxjar
- TaxJar has been designed to be simple, quick, and automated. It will keep you in compliance for more than 11,000 tax jurisdictions across the U.S.
- With the AutoFile tool, you won’t need to worry much longer about due dates and late submissions of tax returns, etc., as TaxJar takes care of the rest for you – more on that later!
- TaxJar allows you to save time and allow you to concentrate on your business.
- It is easy to use, and you don’t have to be an accountant or tax expert to understand it!
- Aside from its less tedious nature, TaxJar also provides businesses with amazing customer support and plenty of helpful resources to guide you through when it comes to sales tax compliance!
- TaxJar is generally easy to use, but it can be complicated for merchants who are not familiar with the process.
- Sometimes, the interface can be frustrating. Some users report having to open more than five tabs just to file a tax return for one state.
- The pricing of lower-tier plans can vary based on factors such as additional AutoFile fees if you’ve used up the free credits allowed in a plan – more on that as we’ll discuss the pricing shortly.
How Much Does TaxJar Cost?
TaxJar offers three pricing options: Premium, Professional, or Starter. Let’s dive deep into these subscription tiers.
Starting at $19/month, the Starter plan provides essential sales tax services for small businesses. The plan usually handles 200 total returns and purchase orders per month. However, the price could change if there is more. This tier offers free tools that can help you significantly with sales tax compliance like sales tax reporting, AI-driven product taxability recommendations, and basic CSV data imports.
Customers also get data integrations and up to four free AutoFiles per annum. Starter also allows for support for multiple business accounts and e-mail support.
If your business has more experience and expanded reach, more challenges may likely come ahead. The Professional plan is for you. Starting at $99/month, you get all the features from the Starter tier, plus some upgrades like full API access, advanced CSV imports, and economic nexus features.
Professional includes an increased limit on data import and API integration, from 3 to 10,10,000 advanced API calls per hour, up to 10 team managers users, and 12 free AutoFiles per calendar year. TaxJar Professional users who manage to generate over 1,000 orders per year are eligible for phone customer service in addition to e-mail support. Like Starter, the price of this tier may change if you gain more than 200 allotted orders.
TaxJar Premium includes all the features that you need to ensure sales tax compliance. Apart from providing experienced businesses and enterprises with all the Starter and Professional features, Premium offers unlimited API and data integrations with many e-commerce and marketing services, unlimited AutoFiles, and an unlimited number of team users.
You also get 25,000 API calls per hour, and white-glove support through a dedicated account management group. Premium is not priced in a fixed range like the other plans. Instead, it’s fully customizable according to your business’s needs, and can be negotiable through TaxJar’s customer service.
TaxJar is worth a free 30-day trial. All the features and tools of the Professional plan are available to you, including API access, integrations, data imports and team and user management. You don’t need to pay upfront to access this trial! Npm Taxjar
The Features of TaxJar
Automatic Sales Tax Calculations
TaxJar offers fully optimized functions and services that are designed to reduce the tax burden. Its calculation process is one of them. TaxJar instantly calculates sales tax! Not only does it always ensure you the right rates in correspondence with your customer’s address and tax jurisdiction, but it also gives you the amounts in real-time.
TaxJar makes it easy to quickly calculate taxes and keep up with changes. Its team keeps track of all updates related to sales tax laws and rates and incorporates them into the platform periodically.
TaxJar provides more than just top-notch calculations. It also offers automated reports that include sales tax data from linked accounts, CSV imports and individual state sales tax reports. All of this data is automatically combined into reports for different states with breakdowns according to their tax jurisdictions.
Organizing reports is simpler and more accessible with TaxJar – everything is centralized, making way for quick collaborations with your finance team. Its reporting dashboard lets you see in-depth analysis based on your recent activity. You’re also always up-to-date, as TaxJar collects data automatically all the time.
AutoFile makes this platform stand out among the rest. It’s an electronic sales tax filing tool that gathers user information from e-commerce providers and files them into an automated sales tax return report and payment to be submitted to any state.
AutoFile’s greatest asset is the fact that you are guaranteed to not miss a deadline. AutoFile is designed to be easy to use and eliminates the stress of paperwork. Plus, it saves you time in the long run!
However, while it looks astoundingly impressive, it’s worth mentioning that it can be quite like a limited luxury to lower-tier subscribers. For starter plan subscribers, you can only get 4 AutoFile enrollments free of charge per year.
Sales Tax Nexus Insights
If you use TaxJar in selling your items online, it’s important to know a thing about economic nexus. We’ve essentially covered this topic earlier, but to summarize, instead of paying sales tax within your home state, you will have to encounter paying sales tax to the states where your customers purchased your products, even if you’ve never been a resident there. Npm Taxjar
It can be difficult to determine the nexus. TaxJar offers easy-to-understand insights that will help you stay on track. The economic nexus dashboard not only allows you to check the activity between states, but also shows you if you have reached the required threshold for each state. It comes in very handy, especially if your business continues to grow and reach more states.
Integrations with Online Business Services
TaxJar can be seamlessly integrated with many online business services. You can connect your account to internet marketplaces like Amazon, Etsy, and eBay to determine sales tax. You can also integrate with e-commerce platforms like Shopify, BigCommerce, and similar services where you may sell your listings, payment gateways like Stripe and PayPal, and operation management systems such as Oracle NetSuite, Intuit QuickBooks, and more.
Square, WooCommerce, Walmart, Salesforce and Magento are just a few of the other services that can be integrated with TaxJar. If you can’t find your preferred online business solution in the list, you can always build your own with the TaxJar API, or by importing all data from third-party services through CSV.
Is TaxJar the Perfect Fit for Your Business?
TaxJar has been a reliable and high-tech solution that addresses most of the issues business owners have in managing sales tax. It’s been a top pick for these reasons: 1) it’s easy to use, 2) it’s time-saving, and 3) it helps you and your business in many ways.
It’s highly recommended, and we are right to be so. However, it isn’t perfect in every aspect. Some users reported having problems with customization, while others found issues with TaxJar’s integration with some apps like Shopify. There were also issues with interface misunderstandings and automated calculation. These issues could be addressed.
All other issues aside, TaxJar would be the perfect fit for any business. This is a great tool to add to your business strategy.
Most Frequently Asked Questions Npm Taxjar
What types of businesses use TaxJar
Small and medium-sized businesses, large-scale companies, freelancers, and individuals can all use TaxJar. As of 2022, TaxJar has served over 20,000 businesses, including some of the well-known ones, like Coca-Cola, Land Rover, Microsoft, Shein, and many others.
Is TaxJar available in countries other than the U.S.
As of recently most of TaxJar’s features are limited to the United States. They are not yet available in other countries. The TaxJar API tool only is available in certain territories outside the United States. Businesses in Canada, Australia, the UK, and countries included in European Union can use TaxJar API.
Can I cancel my TaxJar account? How can I cancel my TaxJar account?
If you are unhappy with TaxJar’s service, you can cancel it by going to your account settings. Once you head over to Plans & Billings, you can click the red link that leads you to cancel your current subscription.
TaxJar’s reporting tools, as well as AutoFile, will be removed from your account. If you wish to regain access to those services, you can reactivate your account and subscription anytime.
What are the alternatives to TaxJar?
TaxJar isn’t the only solution for sales tax compliance. There are many other options, some with better features, compatibility with more countries, and some with lower price ranges. The following are alternatives to TaxJar.
- Sovos Taxify