Service Objects’ DOTS FastTax service is now more powerful than ever – particularly for areas that have multiple tax jurisdictions. This means that a few tweaks to your implementation can do a lot more of the sales and use tax calculation work for you. So here are some pro tips to elevate your tax game:
Determine where you have “nexus”
In order to hit the ground running, you will first want to look into your own business’ tax requirements. Often this is done by determining states where your business has sufficient physical presence to require the collection of sales tax, also known as “nexus”, and then charging the appropriate tax based on that information. After determining where you will need to charge tax, and what types of taxes are involved (such as sales or use tax), it is time to head over to our FastTax API.
Search for tax rates by address
FastTax gives you the ability to search tax rates by city and state, city, county and state, ZIP code, or (for Canadian addresses) by province. However, the current version also gives you the ability to search tax rates by address, using an operation called GetBestMatch.
To get the most out of your FastTax subscription, we recommend using this latest operation, which will take your address and return the best available tax rate match. This service will even go as far as returning a ZIP code level match when the specific address level information is not available. In addition to the city/state/county/special tax rates that are returned, we will provide you with information about the location’s unincorporated status., discussed next.
Account for unincorporated areas
If you are interested in properly accounting for areas within a city that are unincorporated, we have you covered. We offer a flag that is called IsUncorporated, and it will have either a true or false value. If the flag is set to true all you have to do is take the total tax rate and subtract off any existing city and city district rates. You will be left with the unincorporated address’ accurate tax rate.
With all of these pieces of information in hand, you will now able to select the rates that are relevant to your business and apply the specific sales and use tax rates that fit your needs.
Let us do the work for you
With the latest version of FastTax, you can harness a real-time tax rate lookup service based on contact addresses that are validated, geocoded, and then matched with a corresponding tax rate. This means that the quickest way to get accurate tax information is to now look up tax rates by address.
Compared with searching for tax rates by city, county or ZIP code, searching by address takes advantage of the deep-rooted integration between FastTax and our address validation and geocoding engines. This is particularly important because tax rates can vary within a municipality or ZIP code, based on factors such as incorporation status, so letting us validate and geocode your contact addresses helps us provide you with the most accurate tax rate data.
While the saying “garbage in, garbage out” still applies, this service will also do its best to correct your input to its proper form. Minor spelling mistakes, standardizations, or even non-deliverable addresses can sometimes be geocoded or corrected to provide you an accurate tax rate for your input address. In total, the combination of your predetermined nexus information and our tax rate lookup service allows for a quick and seamless workflow for your business.
As always, we are here to answer any questions that you may have. If you would like clarification on any aspect of our FastTax web service, please feel free to reach out to us. Our sales and support teams are here to find a solution that works for your business. And if you are a current customer and find a rate that is incorrect, shoot us an email and we will get the discrepancy addressed immediately.