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What's in a Transaction?

This article applies to:Avalara AvaTax

When AvaTax calculates tax and a transactionHoverTT.png is sent from your accounting software to AvaTax, there is a specific order of operations:

  1. Is the address taxable?
    • AvaTax looks at the origin and destination address to see if nexusHoverTT.png is enabled. Learn how to add nexus jurisdictions.
  2. Is the customer taxable?
    • AvaTax looks at the Customer/Vendor Code and sees if the customer is exempt from sales tax based on a number of methods for exemptions. Learn how to exempt your customers from sales tax.
  3. Is the product or service taxable?

Anatomy of a transaction

Transaction data... What it means...
Origin Ship-from address
Destination Ship-to address
Customer/Vendor Code Identification number associated with a customer or vendor. This number is linked with exemption methods in your accounting software, AvaTax, or CertCapture.
Item Item code or SKU associated with your products or services. Mapped to tax codes in either your accounting software or AvaTax.
Tax Code A unique label used to group items (products, services, or charges) by taxability. Can be an Avalara tax code or a custom tax code.
Document Code Identification number associated with the correlating transaction from your accounting software.
Line Amount Amount listed per line on a given transaction. Used to calculate sales tax.
Tax Date Date the tax is calculated. Usually the same as the document date, but may be different depending on your accounting practices. For example, if you calculate sales tax on 04/01, but don't commit the transaction to AvaTax until 05/01, the tax date and document date will differ and the tax rates could have changed.
Document Date The date the transaction is finalized and committed to AvaTax. Usually the same as the tax date, but may be different depending on your accounting practices. For example, if you calculate sales tax on 04/01, but don't commit the transaction to AvaTax until 05/01, the tax date and document date will differ and the tax rates could have changed.
Document status A label to indicate the reporting status of the transaction. Committed transactions are included in all reports and returns filed by Avalara while uncommitted and voided transactions aren't included.