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How to apply the California Teleproduction partial exemption?

Overview

You have customers who should be partial exempt in California according to the CA Teleproduction and post production partial exemption number 6378

Environment

Avalara AvaTax

Resolution

  • AvaTax does not by default apply this tax rate through tax codes or Entity Use Code partial exemptions
  • To set up this functionality, tax rules will need to be set up
    • First create a Rate Override tax rule that sets the CA State tax rate to 1.25%
    • The example shows the Entity Use Code of I)Industrial production / manufacturing, but it would be best to use a custom Entity Use Code, for example X
      • Using a preexisting Entity Use Code will require another rule that sets that EUC to taxable in California
    • If you need certain tax codes to apply to this tax rule, please change the Tax Code field to the specific tax code(s)
  • Once the state rule has been created, you will need to add the selected Entity Use Code to the Customer Card in your accounting system, or create an exemption certificate entry in the Admin Console