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Install and Configure Avalara AvaTax for QuickBooks Online

This article applies to:Avalara AvaTax for QuickBooks Online

Set up an AvaTax account from QuickBooks Online, then connect it to your company in QuickBooks Online so AvaTax can begin calculating sales tax on your transactions.

You must have Master Admin and Company Admin access to install and configure AvaTax for QuickBooks Online.

Download the AvaTax app

To download AvaTax for QuickBooks Online:

  1. In QuickBooks Online, type AvaTax in the app search field.
  2. Select the AvaTax app, and then click Get app now.
  3. In the popup window, select the name of the company you want to connect to AvaTax, and then click Connect. After your account is authorized, the AvaTax for QuickBooks Online login screen opens.
  4. Log in to or sign up for your AvaTax account:

Start your AvaTax free trial

To download AvaTax for QuickBooks Online:

  1. On the Start Your Free Trial Today page, enter your details, choose a password, and click the appropriate button.
    • If you click  Start free trial now, continue to step 2.
    • If you click Buy Now, provide a bit more information about your company, choose a plan, and enter your payment details before continuing to step 2.
  2. On the success page, click Connect QuickBooks.
  3. On the AvaTax for QuickBooks Online login page, use the email address and password you entered for the free trial to log in.

Connect your QuickBooks Online account to AvaTax

To connect AvaTax to QuickBooks Online and configure your account:

  1. Select the company you want to link to AvaTax, and then click Link Company.
  2. On the Manage Your Integration page, click the buttons to configure AvaTax to meet your business's unique needs.
    • AvaTax connector settings
      Section Field and description
      Avalara account
      • Account ID: Your AvaTax account number
      • Avalara Company: The company you linked to AvaTax
      • Avalara Company Code: The code AvaTax uses to identify transactions from your company
      • Avalara Username and Password: The username and password you use to log in to AvaTax
      Integration settings
      • Services
        • Address Validation: If you disable address validation, AvaTax uses the customer's ship-to address as entered to calculate the correct sales tax. Sales tax might be calculated incorrectly if this option is disabled.
      • Calculate tax for
        • All Customers: If selected, QuickBooks Online sends all transactions to AvaTax for tax calculation, and then AvaTax exempts customers marked exempt.
        • Only Taxable Customers: If selected, QuickBooks Online only sends transactions for taxable customers. No exempt customer transactions are sent to AvaTax.
      • Sales Tax Item: A service item created by AvaTax to enable taxability. This can be left at default unless someone at Avalara tells you to change it.

       

    • Manage where you collect tax: AvaTax uses certain criteria to suggest places you may need to collect tax. Review the regions where you're automatically set up to collect tax, and add regions based on your company's needs.
    • Switch Company: Connect another company in QuickBooks Online to AvaTax
    • Disconnect Avalara AvaTax: Disconnect your QuickBooks Online service from your AvaTax account

Enable line-level tax calculation

By default, AvaTax calculates sales tax at the document level. You can also calculate sales tax at the line level. Choose the scenario that applies to your company's QuickBooks Online account.

  • If the QuickBooks Online Automated Sales Tax solution (AST) is inactive:
    1. Follow the instructions in the Set Up Automated Sales Tax on this page to prepare your sales tax agencies in QuickBooks Online.
    2. Follow these instructions to make sure only AvaTax is calculating sales tax on transactions.
  • If the QuickBooks Online AST is active, follow these instructions to make sure only AvaTax is calculating sales tax on transactions.
  • If you're using the QuickBooks Online Sales Tax Center, add Avalara as a sales tax agency to enable line-level rounding.

To add Avalara as a sales tax agency:

  1. In QuickBooks Online, click Taxes > Set up sales tax.
  2. On the Sales Tax Center page, click Add/edit tax rates and agencies.
  3. On the Sales Tax Rates and Agencies page, click New.
  4. On the New Sales Tax Rate page, fill in the following fields with the indicated value, and then click Save:
    Field Value
    • Single tax rate
    • Combined tax rate
    Select Single tax rate
    Tax name AvaTax
    Agency name Avalara
    Rate 0.00
  5. Click Return to Sales Tax Owed and Recent Payments.
  6. On the Sales Tax Rates and Agencies page, click Edit sales tax settings.
  7. In the Edit Sales Tax Settings window, fill in the following fields with the indicated value, and then click Save:
    Field Value
    Do you charge sales tax? Yes
    Default sales tax AvaTax
    Mark all new customers taxable Select to enable
    Mark all new products and service taxable Select to enable

In the Sales Tax Owed table, Avalara is successfully added as an agency, and you can now calculate sales tax at the line-level and exempt customers using AvaTax.

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