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Avalara Help Center

Set Up Tennessee Returns

This article applies to:Returns Central

Tell Us Where You Collect Tax 

Add Tennessee to the places where you collect tax. This tells AvaTax to calculate tax on Tennessee transactions. See the Tennessee Department of Revenue website for details about nexus, registration, and taxes in Tennessee.

Before you add Tennessee, there are two things you need to do:

Tennessee has both sales and sellers use tax. Pick the right tax type based on the way your business is registered and the tax return you need to file. 

"Sourcing" determines the location where a sale is taxed. Tennessee is an origin-sourced state.

Add Your Company Locations 

Add any physical locations you have in Tennessee. This is important for reporting on the returns.

When you add a location:

  • Enter the state-assigned, ten-digit Location ID under Additional Information
  • After you validate the location address, make sure it falls in the jurisdictions you expect. If not, you may want to manage your jurisdiction overrides

The state-assigned location ID is a ten-digit number the state assigns to your location when you register the location with the state. Make sure you enter all ten digits. Example: 0123456789. This is different from your sales and use tax account number which ends in "SLC."

The Tennessee returns can't be filed accurately without this information.

Schedule Your Returns

After you tell us where you collect tax and add locations, you're ready to schedule returns. Go to Returns in AvaTax to provide a funding power of attorney and schedule your returns

Your company name and taxpayer ID from Your Company Details show up on your returns. Make sure they match what’s on your registration information.

Use this info to schedule your returns. Keep in mind that the selections you made when you told us where you collect tax, any location codes you entered, and the forms you select are related and should tie together.

All tax types are reported on a single Tennessee sales and use tax form. Confirm your filing frequency on the registration information provided by the state. 

  • Select form TN SLS 450 if don't have any in-state locations or you only have one in-state location and no sales originating from anywhere else
    • If you're not sure, check your business license or your account information on the state website to verify that you only have one ten-digit location registration number set up with the state
  • Select form TN SLS 450 CS if you have more than one location registered with the state
  • Enter your ten-digit Tennessee sales and use tax account number which ends with "SLC" in the correct format. Example: 1234567890-SLC
  • Tennessee assigns a ten-digit location ID to all out-of-state and in-state registered locations. Enter this number in the Tennessee Location ID field when you schedule the return. Example: 1234567890
    • If you have an in-state location, provide your local tax rate. Tax rate should lie from 1.5% to 2.75% and must be entered as a decimal. Example: .0225 for 2.25%
  • Enter a Tennessee letter ID.
    All the correspondence from the jurisdiction includes a unique letter ID, such as L1234567890 in the header. You can also find this letter ID in the Letters section of Tennessee department of revenue online account. 

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