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Avalara Help Center

Why is my invoice tax amount off by a few cents?

Overview

An invoice doesn't show the exact tax amount expected, based off the flat tax rate - it's off by a few cents.

Environment

AvaTax

Resolution

  • Small differences like this are generally due to Rounding.
    • Rounding produces different results depending on whether Line or Document level rounding is set in Organization > Company Name > Company Settings.
  • By default, the rounding level is set to Line where tax is computed on each line.
  • Setting the value to Document level rounding results in the line level taxes to be summed to a total and then rounded to the nearest tenth of a cent.
  • The states are aware of the possible 1 penny difference in these scenarios and have certified Avalara to use either method of rounding.

Note: If you use more than one accounting system with AvaTax, please make sure the invoice and/or order match between the two systems and both systems use the same rounding level.

Next steps

For more information about rounding levels, see add a company.