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How can I make a customer exempt or taxable for the same item?

Overview

I have one customer who is either taxable or not-taxable, based on which project they are ordering parts for. There are no specific parts and they might order one taxable part and one non-taxable part on the same order. I am wondering if there is a way to separate the sales tax by line item. We do not use system tax codes.

Environment

Avalara Avatax

Resolution

  • In order to maintain taxability for the same item, you will need to either maintain that on a case-by-case basis via your accounting system (ERP) during the invoicing process, or by having a separate item for each way you would like it to tax:
    • Item A TX: mapped to Tax code for taxable.
    • Item A NON: Mapped to tax code for exempt.
  • ​It is only possible to tax items differently if they have a different tax code or if you use line level entity use codes, which is only possible in certain accounting systems.