Avalara and Quickbooks

[wajake41]

All of our sales are entered into QuickBooks. We would like to integrate Avalara into QuickBooks so that Avalara cancalculate and pay our required sales tax quarterly. We would not want Avalara to calculate sales tax on each order either in Miva or Quickbooks, Sales tax due would be calculated and paid on the gross sales amount per quarter to states where we have nuxus. Our desire is to continue not charging sales tax on our sales. We feel this is a marketing advantage. Instead we will increase the cost of our products enough to include our estimated sales tax expenses. This will probably require some tweaking for a year or so. We expect to only have sales tax nexus in less than 10 states. Sales of product with increased price to customers in non nexus states will help cover the cost of tax paid to states where we have nexus.
I would like some forum input on this approach:
1. Can Avalara calculate the correct sales tax using our QuickBook orders?
2. Is anyone using the QuickBooks/Avalara integration for their sales tax reporting. How is it?
3. Opinions/commnets on the approach that we are considering.
4. Other possible solutions so that we can continue to sell without charging the customer for sales tax. My understand is that a merchant can sell without charging sales tax as long as the states with nexus receive the correct tax for the items sold.
Larry

[SNAGuy]

All of our sales are entered into QuickBooks. We would like to integrate Avalara into QuickBooks so that Avalara cancalculate and pay our required sales tax quarterly. We would not want Avalara to calculate sales tax on each order either in Miva or Quickbooks, Sales tax due would be calculated and paid on the gross sales amount per quarter to states where we have nuxus. Our desire is to continue not charging sales tax on our sales. We feel this is a marketing advantage. Instead we will increase the cost of our products enough to include our estimated sales tax expenses. This will probably require some tweaking for a year or so. We expect to only have sales tax nexus in less than 10 states. Sales of product with increased price to customers in non nexus states will help cover the cost of tax paid to states where we have nexus.

Larry,

Before I try to give you my answers/opinions on as many of your of your bullet points as I can, have you taken the time yet to speak with anyone at Avalara, Taxjar or any of the other Sales Tax processing providers? They should be able to initially help you out if they can handle processing transactions that are "Tax Included".

1. Can Avalara calculate the correct sales tax using our QuickBook orders?
2. Is anyone using the QuickBooks/Avalara integration for their sales tax reporting. How is it?

I don't know

3. Opinions/commnets on the approach that we are considering.

We use Avalara and we send them "real time" either through Miva at the shopping cart level or StoneEdge Order Manager each transaction line by line. Each product gets a "Tax Code" and then then each state/taxing authority will determine by that Tax Code whether tax needs to be collected on that individual items. While "widget A" might be taxable say in CA it might not be taxable in TX, likewise "widget B" might not be taxable in CA but is taxable in TX.

Also of course while I live in Orange County CA my city might have a different sales tax rate then my neighboring city and sometimes some parts of some cities or jurisdictions might have additional taxing authorities that want a small percentage of every sale. For this address verification needs to be done at the time the transaction takes place not only down to the Zip Code but the exact house/building # and street.

4. Other possible solutions so that we can continue to sell without charging the customer for sales tax. My understand is that a merchant can sell without charging sales tax as long as the states with nexus receive the correct tax for the items sold.
Larry

I don't know of any other solutions.

Carl

[wajake41]

Hi Carl: Thanks for your reply. Just got off the meeting with Avalara. They answered a lot of my questions. Yes Avalara can be integrated into our QuickBooks Enterprise which is hosted by Right Networks. The tax calculation would be done on each transaction into QB. Yes, the tax due could eat our lunch if we didn't collect sales tax but only raised price but not enough to cover the tax due. Yes they can determine if we have nexus in the states we sell to. $4500 to do that but this cost can be credited to our transaction fees if we enroll. Reporting tax runs about $50 per filing with a reduction to about $45 if you do a lot of filing. We were given a "Nexus Study Example" that has some interesting info on "Options for Compliance" (i.e. it might involve back filing for past taxes due (especially scary),, Amnesty, etc. Definitely worrying reading. Bottom line on compliance is that if you don't get compliant now, it's going to cost you big time in the future.
Conclusion: this is going to be expensive! We are going to talk to TaxJar next..

[SNAGuy]

Hi Carl: Thanks for your reply. Just got off the meeting with Avalara. They answered a lot of my questions. Yes Avalara can be integrated into our QuickBooks Enterprise which is hosted by Right Networks. The tax calculation would be done on each transaction into QB. Yes, the tax due could eat our lunch if we didn't collect sales tax but only raised price but not enough to cover the tax due. Yes they can determine if we have nexus in the states we sell to. $4500 to do that but this cost can be credited to our transaction fees if we enroll. Reporting tax runs about $50 per filing with a reduction to about $45 if you do a lot of filing. We were given a "Nexus Study Example" that has some interesting info on "Options for Compliance" (i.e. it might involve back filing for past taxes due (especially scary),, Amnesty, etc. Definitely worrying reading. Bottom line on compliance is that if you don't get compliant now, it's going to cost you big time in the future.
Conclusion: this is going to be expensive! We are going to talk to TaxJar next..

Larry,

Great to see you are on your way in gathering the answers you are looking for. You are so right that this will be a costly to implement but the alternative of receiving multiple letters from various states requesting $$$ can be way more expensive.

Carl

[wajake41]

We decided to go with TaxJar after conversations with both Avalara and TaxJar. We went live with TaxJar on Oct 1. We imported our 2018 and 2019 sales using their import feature and then ran their economic nexus report to find where we have to collect sales tax. (BTW everyone e-selling in Kansas has economic nexus there, they have no threshold on sales amount.) Had good support from TaxJar during our implementation Pleased so far.
We will be using the TaxJar import feature to batch import our sales from QuickBooks on a monthly basis as we have both Miva and non Miva sales. We have turned off Miva's feed of sales into Taxjar. Using only the TaxJar sales tax calculation feature for our checkout.