It can be difficult to manage sales tax.
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. 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 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? Taxjar Obsolete New Laws
Since its inception in 2013, TaxJar serves business enterprises and online sellers, intending to ease the already complicated process of sales tax compliance. There are over 11,000 tax jurisdictions in the United States. Each one has its own rules and regulations. 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.
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. Things got even more complicated when in 2018, the US Supreme Court ruled that businesses must pay sales tax based on where the consumer purchased any product. Business owners were forced to learn and remember tax codes after tax codes, adding more complexity.
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. 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 Obsolete New Laws
- 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.
- The interface can also sometimes be inconvenient, as some users have reported cases of having more than five browser tabs open just to file one state’s tax return.
- 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 take a deeper look at these subscription tiers.
The Starter plan starts at $19/month and provides essential sales tax services to small businesses. It usually handles up to 200 total purchase and returns orders per month, but the price may change if the volume goes past the number. 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. In addition, Starter allows support for multiple business accounts, as well as e-mail support.
More challenges are likely to come if your company has more experience and a wider reach. 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 also includes increased data import and API integration limits from 3 to 10, 10,000 advanced API calls per minute, up to 10 team management users, and 12 free AutoFiles per 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. If you receive more than 200 orders, the price for this tier could change.
TaxJar Premium includes all the features that you need to ensure sales tax compliance. Premium includes all the Starter and Professional features for enterprises and experienced businesses, as well as unlimited API and data integrations to many e-commerce services and unlimited AutoFiles. There is also unlimited team usage.
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. You can get full access to all the Professional plan features and tools, including API access and integrations, data imports, and team and user management. This trial is free and you don’t have to pay anything upfront! Taxjar Obsolete New Laws
The Features of TaxJar
Automatic Sales Tax Calculations
TaxJar offers fully optimized functions and services that are designed to reduce the tax burden. One of those is its calculation process. 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.
With TaxJar, you won’t need to take long to calculate taxes one-by-one nor go through the added hassle of keeping up with the 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. TaxJar automatically collects data so you’re always up to date.
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. 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. Starter plan users, for example, get only up to 4 free AutoFile enrollments 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 Obsolete New Laws
Determining the nexus can be confusing. Thankfully, you don’t have to jump through hoops, because TaxJar provides accessible insights to keep you on track. The economic nexus dashboard doesn’t just let you check activity between states but also lets you know if you’ve reached the required nexus 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 be seamlessly integrated 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.
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 right 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 were also issues with interface misunderstandings and automated calculation. 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!
Frequently Asked Questions Taxjar Obsolete New Laws
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?
TaxJar features are currently 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. 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. 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. 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 other alternatives out there, with some offering more features and compatibility with more territories, and others with cheaper price ranges. We suggest you check out the following as alternatives to TaxJar:
- Sovos Taxify