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.
With TaxJar, all the challenges in sales tax are simplified, giving you and your business the upper hand. This review will cover all aspects of 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 Zip Code Lookup
TaxJar was established in 2013 to serve online sellers and business entities. Its goal is to simplify the complex process of sales tax compliance. There are over 11,000 tax jurisdictions in the United States. Each one has its own rules and regulations. 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. 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. This resulted in more burdens for business owners, having to learn and memorize tax codes upon tax codes on top of everything else.
That’s quite a task. 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. Taxjar Zip Code Lookup
- 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.
- The AutoFile tool will take care of all the details for you.
- 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 is easy to use, and you don’t have to be an accountant or tax expert to understand it!
- TaxJar is not only less complicated than other software, but it also offers amazing customer support and a wealth of resources that will help you comply with sales tax.
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- 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.
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 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 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. You get all the features of the Starter Tier, plus upgrades such as full API access and advanced CSV imports.
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. 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. 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. 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. It is fully customizable to meet your business’s needs and can be negotiated through TaxJar’s customer support.
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. This trial is free and you don’t have to pay anything upfront! Taxjar Zip Code Lookup
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Automated 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.
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 doesn’t just provide you with top-notch calculations, but also automated reports on all the sales tax data collected by the platform from linked accounts, CSV imports, and even 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. 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.
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. 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. 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 Zip Code Lookup
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. It comes in very handy, especially if your business continues to grow and reach 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. 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 right fit for your business?
TaxJar has proven to be very reliable and high-tech, easing most of the challenges business owners face in their day-to-day lives when it comes to 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 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. It would be nice if those issues were to be improved.
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 Zip Code Lookup
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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. 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. You can cancel your subscription by clicking the red link once you have accessed Plans & Billings.
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 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