QuickBooks launches Sales Tax Calculator Site

Recently, QuickBooks launched a new Sales Tax Calculator landing page. With nearly 11,000 local sales tax jurisdictions in the U.S., the goal of the new landing page is to help small businesses see how the different sales tax affects their business and keeps tracks of all the changing laws so SMBs don’t have to.

Intuit's new calculator takes the guess work out of figuring out sales tax, with Intuit automatically doing the math for small businesses on thousands of state, city, and county sales tax rates in the U.S. The sales tax reporting will be changing for many small businesses engaged in online sales as a results of all the changes taking place in sales tax recently.

For more than 20 years, states could only require retailers to register, collect and report sales taxes if they had a physical presence in their jurisdiction(s). But this standard completely changed on June 21, 2018, when the U.S. Supreme Court ruled in favor of South Dakota in the landmark case of South Dakota vs. Wayfair, which required out-of-state sellers with more than $100,000 of goods/services sales or 200 transactions in South Dakota annually, to collect and remit South Dakota Sales Tax.

With the Supreme Court's action, the long-standing 'physical presence' requirement standard was abolished and 'economic nexus' became the standard. Multiple states had similar laws to South Dakota pending enforcement, others had legislation pending approval which has since passed, and others have since enacted similar legislation or are about to.

Now, you must know who to pay in which states, other than your 'home state.' You will have sales tax obligations that might not be as simple as they were before, depending on your potential involvement with companies like Amazon or Ebay. Many state believe that if you are selling through one of these giants then you are 'part of the whole' and the entire group is treated as one.

Along with knowing who you must pay, you have to know with whom you must register, and how to register. Most states have single-state agency registration, some states are part of what is called 'Streamlined Sales Tax' and you can register for those states with a single registration, but there are other 'home rule' states that allow each political sub-division in their state to set their own sales tax and tax rules, including registration and collections, and it can be a 'real mess.'

Of course, you must not only know who to collect and pay, and who to register with, but what tax to collect, when the tax is due, upon what products it is due, when different amounts of tax are due upon different products, what products are exempt from tax, and so on and so forth.  All of that can be very complicated. It gets even worse when tax may be due at the seller's location in some jurisdictions, or due at the delivery location in other jurisdictions, or will be dependent upon the manner in which the product changes hands.

Last, there is the issue of filing and paying your taxes. Even if it is a simple as a single agency for each state for whom collections are due, filing frequencies may vary along with the filing dates. In some states, the filing frequency depends upon the amounts of money due with the return, in others it depends upon the specific tax types being remitted. Discounts may or may not be eligible if remittances occur by certain dates, once again depending upon the specific jurisdiction. And remember, all of this can be compounded by multiple remittance jurisdictions in some 'home rule' states.

An easy way to manage Sales Tax is using QuickBooks Online and the new 'sales tax calculator' landing page; promoting the benefits of 'automatic sales tax tracking,' 'product categorization,' 'sales tax liability tracking' and 'sales tax reporting'. In other words, it illustrates exactly how QBO covers all the bases of managing the various sales tax issues and problems we have just discussed above. So, some people will obviously consider this new page more 'hype' than 'help,' but as far as we are concerned, the educational benefits it provides and the easy to use 'free calculator look up' (for those who are still trying to do things the 'old manual way') will be of great benefit to the majority of those who make use of it. 

For more information about Sales Tax Filing, check out Intuit's blog article titled 4 Steps for Filing Your Sales Tax Successfully.

And, be sure to also check out our own SALES TAX TUESDAY 2019: Are You Nexus Compliant? (from just last Tuesday) in which Murph goes over many of the principles of assessing your 'economic nexus' liability in a post South Dakota v. Wayfair environment.