It can be difficult to manage sales tax.
Sales tax compliance is one the most complicated business processes. There are a lot of paperwork and calculations involved. 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.
With TaxJar, all the challenges in sales tax are simplified, giving you and your business the upper hand. 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. Do check out our article below, however, because it has a comprehensive overview of TaxJar.
What does TaxJar do? Taxjar California Modified Origin
Since its inception in 2013, TaxJar serves business enterprises and online sellers, intending to ease the already complicated 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.
Although it may seem simple from a superficial level, the process is actually quite complex. 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. Business owners were forced to learn and remember tax codes after tax codes, adding more complexity.
That’s quite a task. TaxJar simplifies the complex tasks of sales tax compliance and makes them simpler. This allows you to prioritize the most important aspects of your business without having to worry about tax computations.
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. Taxjar California Modified Origin
- 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!
- Using TaxJar for sales tax compliance saves you more time compared to filing everything manually, giving you the chance to focus more on your business.
- It’s easy to use – you don’t need to be a full-on tax or accounting expert to understand how it works!
- 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!
- Although TaxJar is known to be generally convenient, it may be a bit complicated on the first try, especially for the uninitiated merchant.
- 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.
- Pricing for lower-tier plans may vary depending on factors like additional AutoFile fees if credits are exhausted. We’ll be discussing pricing soon.
What is the cost of TaxJar?
TaxJar offers three pricing plans: Starter, Professional, and Premium. 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.
More challenges are likely to come if your company has more experience and a wider reach. That’s where the Professional plan comes in. You get all the features of the Starter Tier, plus upgrades such as full API access and advanced CSV imports.
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.
With TaxJar Premium, you get all the features you could ask for when it comes to sales tax compliance and much more. 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.
Try it Free of Charge
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! Taxjar California Modified Origin
Automated Sales Tax Calculations
TaxJar comes with fully optimized functions and services built to ease the tax burden. One of those is its calculation process. TaxJar instantly calculates sales tax! It will instantly calculate the sales tax for you, and it will always match the correct rates with the customer’s address.
TaxJar makes it easy to quickly calculate taxes and keep up with changes. The platform’s team tracks all changes related to sales tax rates and laws, and integrates them into the platform regularly.
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.
TaxJar makes it easier and more accessible to organize reports. Everything is centralized, which allows for faster collaborations with your finance department. The dashboard allows you to see detailed analysis based upon your 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 is an electronic sales tax filing platform that collects user information from ecommerce providers and then files it into an automated sales tax report and payment to be submitted in any state.
AutoFile’s greatest asset is the fact that you are guaranteed to not miss a deadline. There’s no need to even go through the stress of paperwork or extra hands, as it’s designed to be easily manageable. It saves time and money in the long-term.
It’s amazing, but it can also be a luxury for 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. This topic has been covered briefly before. However, to sum up, rather than paying sales tax in your home state, customers will be required to pay sales tax in the states where they purchased your products. Taxjar California Modified Origin
It can be difficult to determine the nexus. Thankfully, you don’t have to jump through hoops, because TaxJar provides accessible insights to keep you 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. This is especially useful if you have a growing business that wants to expand into more states.
Integrations with Online Business Services
TaxJar can seamlessly integrate with many online business services. To determine sales tax, you can connect your account with online marketplaces such as Amazon, Etsy and eBay. Integrations can be made with e-commerce platforms such as Shopify, BigCommerce and other similar services that allow you to sell your listings, use payment gateways such as Stripe or PayPal, and operate management systems like Oracle NetSuite, Intuit QuickBooks and many more.
Other partner services that are integrative with TaxJar include Square, Xero, Walmart, Salesforce, Magento, and WooCommerce among others. 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.
While it’s highly acclaimed – and rightly so – we can’t fully say it’s perfect in all aspects. Some users had issues with customization while others experienced problems with TaxJar’s integration to Shopify and other apps. 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.
Frequently Asked Questions Taxjar California Modified Origin
Which types of businesses use TaxJar?
Small and medium-sized businesses, large-scale companies, freelancers, and individuals can all use TaxJar. TaxJar served more than 20,000 businesses as of 2022. This includes some well-known companies like Coca-Cola and Land Rover, Microsoft, Shein and many other.
Does TaxJar work in other countries outside the U.S?
As of recently most of TaxJar’s features are limited to the United States. They have not yet been extended to other countries outside US jurisdiction. Only the TaxJar API tool is supported in a few non-US territories. TaxJar API is available to businesses in Canada, Australia and the UK.
Can I cancel my TaxJar account? If so, how?
If you are unhappy with TaxJar’s service, you can cancel it by going to your account settings. You can cancel your subscription by clicking the red link once you have accessed Plans & Billings.
You will lose access to TaxJar’s reporting tools and AutoFile. If you wish to regain access to those services, you can reactivate your account and subscription anytime.
What other alternatives are there to TaxJar
TaxJar isn’t the only sales tax compliance solution available. There are other alternatives out there, with some offering more features and compatibility with more territories, and others with cheaper price ranges. The following are alternatives to TaxJar.
- Sovos Taxify