Safe Harbor Overrides, or TAM Overrides, allow you to override the federally-defined default safe harbor values by specifying a new TAM. The TAM (transaction amount multiplier) specifies the percentage of the transaction amount that is to be taxed. For example, a TAM of 0.5 indicates that 50% of the transaction amount should be taxed.
There are three types of Safe Harbor Overrides:
|Safe Harbor Type||Default Federal TAM Percentage (decimal value)|
The basic approach to setting the TAM for a Safe Harbor override is the same across all AvaTax for Communications (AFC) products. Pass the Safe Harbor Type, the original default TAM as a decimal, and the new Federal TAM as a decimal. The State TAM is calculated automatically (State TAM = 1.0 - Federal TAM).
Why use a Safe Harbor override?
The Federal Universal Service Fund (FUSF) applies to cellular, VoIP, and Paging services. Many states specify that their Universal Service funds also apply to cellular service. However, the FUSF applies to the interstate portion of the service and the state USF generally applies to the intrastate portion of the service. The FCC allows carriers to assume that x% of their traffic is interstate in nature. However, you may find it more beneficial to perform a quarterly traffic study on the network and document the traffic study with the FCC/USAC. The federal percentage determined as part of the traffic study becomes the new TAM value used during AFC tax calculations.
Implement a Safe Harbor Override
Implement the Safe Harbor Override per transaction or at the account level.
- Transaction-level implementation allows you to pass the new TAM per transaction at the time of the tax call.
- Account-level overrides apply to all applicable transactions with no additional information needed in the tax call.
Find instructions for implementing a Safe Harbor Override by product in the table below.
|AFC Product||Transaction-level Implementation||Account-level Implementation|
|AFC SaaS Pro REST v2||Set a transaction-level Safe Harbor Override in REST v2||
Submit a support case to request a TAM override for your account. Provide this information:
|AFC SaaS Pro REST v1||Set a transaction-level Safe Harbor Override in REST v1|
|AFC Viewer||Add a Safe Harbor Override to AFC Viewer|
|AFC SaaS Pro Soap||Specify a Safe Harbor Override for a Traffic Study|
|AFC SaaS Standard||Specify a Safe Harbor Override for a Traffic Study|
|AFC Manager||Add a Safe Harbor Override to AFC Manager|
Use AFC function calls:
Set TAM overrides in the EZtax configuration file: