How Does TaxJar Calculate Deductions/Exemptions

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Taxes have always been one of the hardest things to do regardless of whether you’re running a business or not. Even more so if you do not have a degree in accounting or finance. Tax-related tasks can be overwhelming, particularly when you’re packed with things to do. In the event that you do not have the funds to engage an accountant doing it on your own could be dangerous. If you miss one detail it could mean you have to redo things again!

Almost everyone wants to skipping this step. But , as it’s a requirement and mandatory, there’s no other choice.

What is the best way to deal with it?

It is always possible to simplify our lives by using tools like TaxJar.

Here we’ll take a look at this popular life-saving device and how it can assist you. Although this is quite a long read but you’ll be able to determine if TaxJar is what you need in the present.

Do you prefer watching videos rather than watch them? Check out this video – by Marcus Stonelius on YouTube they also provide a comprehensive analysis of TaxJar’s features.

If you prefer to read, then let’s get right into it.

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What is TaxJar How Does TaxJar Calculate Deductions/Exemptions

Founded in 2013, TaxJar is an online platform that assists you in automating your reporting, filings and sales tax calculations. TaxJar is a solution to all aspects of your sales tax cycle. Additionally, you can use it in all of your sales channels to ensure compliance with sales taxes. It streamlines processes that take days to complete and is completed in just a few minutes.

TaxJar has been utilized in different industries such as food and beverage businesses, SaaS, retail, services, and even medical institutions.

How can it help you?

TaxJar is widely used by owners of online businesses to make their business more organized and straightforward. Let’s take a look at their features and services.

How Does TaxJar Calculate Deductions/Exemptions

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Services and features

Integration

One of the most important things you’ll want to check you have a tax accounting platform seamlessly works well along with sales funnels. If you’re selling through multiple channels, you need to maintain everything in line. The most important thing is not to face a penalty due to missing a single minor point.

TaxJar allows you to display your key metrics in one place. So, there’s no requirement to collect information from multiple sources and organize it into a single platform. All you need to do is integrate TaxJar, then the system will do the rest.

Other than that, TaxJar also integrates with other platforms that help in the process of making payments. Here’s a list of platforms that they can connect with:

  • Xero
  • Amazon
  • Magento
  • BigCommerce
  • Shopify
  • Walmart
  • eBay
  • WooCommerce
  • Square
  • Etsy
  • Stripe
  • PayPal

Filing

TaxJar allows clients to submit their sales tax by hand or using TaxJar’s AutoFile feature. In our review we’ll take a look at both.

If you choose to manually file your tax returns, TaxJar will allow you to connect all those sales tools. When the time is right for filing tax returns for income, the team will instruct you on how to handle these. But, it is up to you and your team to complete everything in time. TaxJar is only there to guide you on what you have to do but not handle it.

If you prefer an Auto file, TaxJar will do the filling – that means you don’t have to fill out all forms by hand. Through this feature, everything will be automated, from calculating sales taxes through recording, and then processing it. However, there might be additional costs if the feature is not part of the plan you choose.

Sales Tax Reports

As we mentioned, you can use TaxJar to ease your accounting woes. All orders made through your e-commerce channels can be put together into one dashboard using this platform. From there, you and your team can access everything you need, like an inventory of your transactions, reports, and the data.

The most appealing aspect of the feature you’ve chosen is it lets you to update automatically every day. Not only will they let to know the amount you’ve earned and how much you’ve earned, but they also let you determine when your next payments are due.

Their dashboard can also allow users to view in detail the overall sales taxes in your business. It is also possible to export the data in CSV format. CSV file if you need it for your financial planning and accounting processes or if your team needs it for centralized reporting.

Training and Streamlining

TaxJar helps organize and keep track of all of the sales avenues you use. It means you don’t need to search for your documents when you’re when you’re in a pinch. Even if you already have your accountant, this function can help them be more efficient.

Additionally, knowing the figures for the sales tax you pay in advance can help you allocate your money more efficiently. You’ll know better how much budget you have for other operating expenses.

What’s more is that TaxJar provides training and tutorials not only on their platform, but for anything connected to sales tax. You can look through their webinars, guides, or blog posts for additional info. Additionally the sales tax calculator is useful if you’re planning to complete everything yourself.

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How much does TaxJar cost?

We know how crucial it is to determine your budget. Some platforms offer superb features, but they can be too costly for the business you run. For this reason we’ll take a look at TaxJar’s pricing levels and what each of these options can offer you. At present, TaxJar offers three plans: Starter, Professional, and Premium.

Starter

Their Starter plan costs $19. They say it’s the most effective plan for those who need assistance with filing requirements and reporting. It includes the tax on sales, four autofiles for free each year, and a CSV import. With the starter plan, you can access their AI tax recommendations.

If you’re a smaller company owner, this plan will be perfect for you. It may not offer all of TaxJar’s features but it comes with all the basics you require.

You can also contact their support team with their email support chart. You’ll also be able to use their integration features.

Professional

If you’re looking for that is more than the basic features and options, then the Professional plan could be the one for you. It’s priced at $99 but you can increase it when you add additional features.

So how different is it from the original plan?

In addition to having access to all of the Starter plan’s features, you also get access to their support via phone access to APIs, as well as the ability to do advanced CSV import. You can also have 12 free AutoFiles each year.

Premium

If you run a large company, you may need to go for an upgrade instead. It includes all of the features needed to make your tax filing easier. Moreover, they allow unlimited data import integrations, Integrations with APIs, teams of members, and AutoFiles.

They also have a team who are devoted to managing your account. But, they don’t divulge how much the Premium plan will cost you. How Does TaxJar Calculate Deductions/Exemptions

However, they did mention that this plan is tailor-fit for each user. The cost of the plan will be different depending on what you need to run your business.

Free Trial

Fortunately, you don’t need to risk your money to see if this platform is for you. If you’re still looking into other options, they have a 30-day free trial. It should give you enough time to determine whether the software is a good fit for you.

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Pros and Cons

Now that we’ve covered all you need to know about TaxJar let’s take a breather. In order to sum up the whole thing Here are the advantages and disadvantages of the use of TaxJar for your company.

Pros

  • Has the Tax Advisor option for some plans
  • AutoFile features to reduce time
  • Available in most USA states
  • Provides Taxes on sales online calculator
  • Has support service team
  • The dashboard is easy to navigate
  • Offers a 30-day free trial
  • It can be integrated with other platforms.
  • Allows you to track multiple sales channels

Cons

  • AutoFile limit is based on the plan
  • AutoFile has extra fees
  • Certain countries will not be able to access the API feature.
  • Only applicable for USA customers.
  • Needs accountants and owners to recheck local legislations

The Final Verdict

With everything clearly laid down, TaxJar can be a great platform companies that have multiple sales channels and uses numerous platforms. If this sounds like the way you do, then you should try this.

Not only will it help you track your products and revenue however, it will also help you meet the deadlines you set. It’s also an excellent option for accountants as they have a Tax Advisor program. You can get tips and get knowledge from their seminars about taxes through it.

Utilizing TaxJar will help you save more time while keeping track of every deadline and obligation you have to fulfill. If you’re in an area with complex tax laws, this can definitely help you get your mind around it. How Does TaxJar Calculate Deductions/Exemptions

If handling your taxes is straightforward, then TaxJar may be an unnecessary expense. If you’re only dealing with one or two channels of sales, TaxJar won’t be needed to track all of it. If you find the whole procedure simple to follow and you’re comfortable with it, you may be better off doing it by yourself.

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FAQ How Does TaxJar Calculate Deductions/Exemptions

What areas does TaxJar offer API support?

TaxJar currently works with countries like the United States, the EU, Australia, and Canada.

Can I incorporate Shopify together with TaxJar?

Yes. You can sync your Shopify account to TaxJar to make it easier to monitor and updates.

Can I convert any kind of currency using TaxJar?

Unfortunately, no. TaxJar does not convert currency values. The transactions are in USdollars. If you’re using another currency, you’ll have to convert it to USUSD before TaxJar will calculate the tax.

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