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If you thought tax season was a trial, e-commerce operators haven’t seen anything yet. By the end of the year, 23 states will be charging e-commerce businesses taxes. Imagine. Different products are categorized differently and taxed differently in different states! But never fear; Solid Cactus and Avalara can make your life easier when it comes to charging and collecting taxes as well as assembling the necessary tax reports.

The problem many merchants on the Yahoo! Store platform encounter is that you need to manually set up all the zip code ranges and add a flat rate or percentage. This is time consuming and must be manually updated when county level, city or municipality taxes change. In Tennessee, the sale of an item is subject not only to the state sales tax of 7%, but the local sales tax on the first $1,600, plus an additional state sales tax of 2.75% on the second $1,600, all of which cannot exceed $3,200 - potentially subjecting a sale to a 9.75% sales tax rate. Confused yet? Here are some other exotic tax laws:

• In Minnesota, non-edible cake decorations are taxable, but edible cake decorations are exempt.

• In Texas, plain nuts are exempt “food,” but once a candy coating is added, they become taxable “candy.”

• In Rhode Island, fruit juice that is less than 100% pure is taxable. Cranberry juice cocktail – a mixture of juice and water, or concentrate — is exempt.

• In Massachusetts, a clothing item costing up to $175 is exempt from sales tax. However, any item costing $175.01 and above is subject to the 5% state sales tax.

• In New Jersey, naturally carbonated water is exempt, but artificially carbonated water is taxable.

• In Pennsylvania, state and U.S. flags are not subject to tax, but if either is sold with “accessories” (i.e. a pole), the entire purchase becomes taxable.

With many states adopting the Streamlined Sales Tax or SST (http://www.streamlinedsalestax.org/) there will be more rules in which products will need to be taxed. Some changes will be difficult for merchants to manage as they relate to how products are sold. Currently17 states are “Full Members” of the SST:

• Arkansas

• Indiana

• Iowa

• Kansas

• Kentucky

• Michigan

• Minnesota

• Nebraska

• Nevada

• New Jersey

• North Carolina

• North Dakota

• Oklahoma

• Rhode Island

• South Dakota

• Vermont

• West Virginia

• Wyoming

In addition to the 17 “Full Members” several other states are considered “Associate Members,” meaning they’re in line with the SST requirements although the state is not yet in full compliance. They are:

• Ohio

• Utah

• Tennessee

• Washington

The SST rules will affect different merchants in different ways which could make calculating sales/use tax a “taxing” task. Finally, there is a solution.

Solid Cactus has partnered with Avalara, a leading provider of real-time tax calculations and a SST certified tax solution. Among the features of this partnership are:

Reports and Remittance:

Save time and resources by using a single solution, integrated into your financial application to submit one remittance payment. Avalara not only takes care of the forms you need for each jurisdiction where you have nexus, but also remits the liability on your behalf.

Reporting Tool:

Comprehensive and easy to use, Avalara’s reports provide detailed, summary and exception reports to satisfy statutory tax return requirements. Ensure full statutory compliance, superior internal process controls, and best practices for sales and use tax.

Reports:

AvaTax offers a crucial component to sales tax compliance: detailed, on-demand reports provide you with quick access to the information needed to prepare and submit sales tax returns. You can easily and quickly generate reports, which can be exported to the file format that works best for you.

The Shipping Manager integration with Avalara lets you offer features to enhance your business performance and will make your life much less stressful come tax season.

Shipping Manager is a hosted solution developed to offer merchants the ability to not only offer real-time rates via UPS but also allows calculations real-time via FedEx and USPS. In addition to the ability to pull real time rates, merchants can also elect to use rate tables as well. This option gives merchants the flexibility to charge shipping costs based on their business needs. This allows merchants to charge accurate shipping rates on the items they sell no matter what method you use.

Customize Your Shipping
Shipping Manager also offers the ability to customize your shipping from the item level. Some of the item levels include marking items as “Free Shipping” so that they are always a $0.00 shipping rate no matter which method of shipping customers choose. You can also specify select shipping methods that are available as free shipping for an item. Box dimensions can be specified to ensure an accurate charge and at the same time items can be specified as over-sized. An “Origin Zip” can be assigned to an item in addition to help calculate a more accurate charge. If your items have multiple boxes you can specify how many boxes the item requires for shipping and you can even include the individual box sizes and weights. Additional Markups can also be added to each item. This adds markups to the shipping rate already calculated by either the real-time rates or the rate table. This type of customization is helpful if you want to make sure you are charging for handling or shipping supplies.

You can also create custom shipping methods. This is extremely useful for merchants who ship very small items or very large items as you can specify minimum and maximum weights, order values and, if you choose, you may include a “Free Shipping” threshold.

Calculate Your Tax Charges
Shipping Manager is also able to calculate tax charges. Merchants can set the Tax Rate as a percent, flat rate or both per state or Canadian Province. Have you ever undercharged tax in a state? Is tax time a nightmare for your business? Need more accurate tax rates? Solid Cactus has you covered. We have partnered with Avalara to offer our clients the ability to calculate real-time tax rates based on the Zip+4. Not only will Avalara allow you to charge accurate, real-time tax rates but it will also offer reporting so you know where you collected various taxes from and how much was collected.

Show Customers Their Shipping Rates
Solid Cactus also will be offering a new tool to help shoppers see the shipping rates before they even add an item to the cart. Far too much shopping cart abandonment occurs because of shoppers adding an item to the shopping cart just to see what the shipping charge is on it. To help combat this, Solid Cactus offers a Shipping Calculator which can be integrated on the Yahoo! Item Page. When a shopper is thinking about buying an item, he or she will be able to enter in their zip code and instantly see the shipping charges for all methods on that item. Now shoppers will know exactly what they will be paying before they even add the item to the cart. Conversely, if you don’t want to show all your shipping methods on the item page, you don’t have to. You will be able to specify which shipping methods and costs to show on the item page.

Shipping Manager from Solid Cactus can help you customize your shipping, calculate your tax charges and show customers their shipping rates. Want to get Shipping Manager integrated into your Yahoo! Store? Want to talk in more detail about its functions? Give Solid Cactus a call at 888.361.9814.

If you’d like more information about Avalara, visit: http://www.avalara.com/