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What You Sell

This article applies to:Avalara AvaTax Update

Some products and services are taxed differently in different jurisdictions. Associate pre-defined Avalara tax codes with each product and service you sell so AvaTax Update knows what tax rate to apply in each jurisdiction.

Not all items need to be mapped to tax codes. Avalara has tax codes for every type of item that has special tax laws out there somewhere, but some things don't have any unique tax rules affecting them in any jurisdiction. If you can't find a tax code that matches what you're selling, map the item to tangible personal property (TPP). Items that aren't mapped to Avalara tax codes are also treated as tangible personal property, and are fully taxed during calculation.

Map Avalara tax codes to your products either in your accounting software or in AvaTax Update.

Map items to tax codes

Map items to Avalara tax codes, and when your accounting software processes transactions, or when you upload the transactions to AvaTax Update, AvaTax Update determines the taxability for the items you sell based on the rules behind these Avalara tax codes. Find the codes you need using the online Tax Code Search Tool.

You can map items to Avalara tax codes in your accounting software or in AvaTax Update. Usually, mapping them in your accounting software works better and takes less time. See our handy chart for a little guidance deciding whether you should map items to Avalara tax codes in your accounting software or directly in AvaTax Update.

To learn how to map Avalara tax codes in your accounting software, check your accounting software configuration documentation. To map items to Avalara tax codes in AvaTax Update, go to Settings > Manage Items With Special Tax Treatment.

Keep in mind that Avalara updates Avalara tax codes when taxability rules and laws change, but any custom tax codes and rules you create aren't automatically updated when changes occur. To be sure you're using the most current rules to tax your products and services, use Avalara tax codes. If you map your items to universal product codes (UPCs), you don't need to use Avalara tax codes because UPCs already have taxability rules associated with them.

If you map in both your accounting software and in AvaTax Update, the mapping in AvaTax Update overrides any mapping in your accounting software.


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