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Avalara Help Center

Why is the wrong tax rate being used on my IL return?

Overview

When reviewing your Illinois return, you have found that the wrong tax rate is being listed on the sales tax portion of your return.

Environment

Avalara Returns

Illinois

Resolution

  • This is caused by a combination of the nexus tax type selection for IL and the addresses being used on the transaction(s).
    • If Sales Tax is selected:
      • All of your transactions will calculate as if you were using an instate location, even if the origin address is out of state.
      • If the origin address is outside the state of IL, the destination address will be used for calculation at the full rate.
    • If Sales or Sellers Use Tax is selected:
      • The state registered location should be used as your origin address on the transaction.
      • Using a different location would subject you to the tax rate applicable to that location.
  • The return will use the highest rate calculated.
  • To avoid this issue: 
    • The nexus tax type would need to be Sale and Sellers Use Tax.
      • All transactions with an instate location as the origin address will calculate at the rate of the origin address.
      • All transaction with an out of state location as the origin address will calculate state rate only.
    • The nexus tax type would need to be Sales Tax.
      • All transactions would need to use the IL registered location as the origin address.