Taxjar Documentation

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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. You may be surprised to learn that there is an easier way around 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’ll also share with you the pros and cons, and our final thoughts about whether or not TaxJar is worth adding to your business management ecosystem. Let’s go!

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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? Taxjar Documentation

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. Back then, businesses had to comply with sales tax regulations and rates according to where their transactions were held, where their inventory stocks were located, and how many employees they had hired.

This process may appear simple on a surface level, but in reality, it’s quite complicated. Businesses were tasked with handling varying degrees of tax burdens, and these may vary based on varying 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.

It’s a lot to take, right? 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?

To help you weigh in on your decision, we’ve provided you with a list of pros and cons of using TaxJar as a business tool. Taxjar Documentation

Pros

  • TaxJar is designed with streamlined, simple, and quick automated features to keep you in compliance with more than 11,000 tax jurisdictions in the U.S.
  • The AutoFile tool will take care of all the details for you.
  • TaxJar allows you to save time and allow you to concentrate 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!

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Cons

  • 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.

How Much Does TaxJar Cost?

TaxJar offers three pricing plans: Starter, Professional, and Premium. Let’s take a deeper look at these subscription tiers.

Starter

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 provides free tools that will help you greatly with sales tax compliance such as sales tax reporting, AI driven product taxability recommendations and basic CSV imports.

Customers are also given data integrations with up to three e-commerce services and four free AutoFiles per year included within the tier. In addition, Starter allows support for multiple business accounts, as well as e-mail support.

Professional

If your business has more experience and expanded reach, more challenges may likely come ahead. 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. If you use TaxJar Professional and manage to rake up to over 1,000 orders, you’re entitled to phone customer support on top of e-mail support. If you receive more than 200 orders, the price for this tier could change.

Premium

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. It is fully customizable to meet your business’s needs and can be negotiated through TaxJar’s customer support.

Free Trial

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 Documentation

Taxjar Documentation

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TaxJar’s Features

Automated Sales Tax Calculations

TaxJar comes with fully optimized functions and services built to ease 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. The platform’s team tracks all changes related to sales tax rates and laws, and integrates them into the platform regularly.

TaxJar Report

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 this is automatically compiled into reports for different states, complete with breakdowns from 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. Its reporting dashboard lets you see in-depth analysis based on your recent activity. TaxJar automatically collects data so you’re always up to date.

AutoFile

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.

What’s great about AutoFile is that you’re guaranteed to never miss a deadline! AutoFile is designed to be easy to use and eliminates the stress of paperwork. 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. 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. Taxjar Documentation

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. This is especially useful if you have a growing business that wants to expand into more states.

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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. 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.

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 reported having problems with customization, while others found issues with TaxJar’s integration with some apps like Shopify. There have also been problems with automated calculation as well as interface misunderstandings. It would be nice if those issues were to be improved.

Issues aside, if we answered the question “Is TaxJar the perfect fit for your business?” it would be a resounding YES! We highly recommend you try this out as part of your business strategy!

Most Frequently Asked Questions Taxjar Documentation

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What types of businesses use TaxJar

TaxJar can be used by small and medium businesses, large-scale enterprises, and even freelancers. 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?

TaxJar features are currently 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. 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. 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. You can reactivate or cancel your subscription at any time if you want to gain access to these services.

What are the alternatives to TaxJar?

TaxJar isn’t the only sales tax compliance solution available. There are many other options, some with better features, compatibility with more countries, and some with lower price ranges. We suggest you check out the following as alternatives to TaxJar:

  • Avalara
  • Sovos Taxify
  • Vertex
  • TaxCloud

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