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Overview

The TaxCloud extension connects your Magento store to TaxCloud, so that US sales tax is calculated correctly at checkout and every sale is recorded where it can be filed.

What it does

Calculates tax at checkout. When a shopper reaches checkout, the extension sends the cart — what is in it, where it is going, where it ships from — to TaxCloud, and TaxCloud returns the tax due. That covers more than 13,000 US jurisdictions, including the ones where the rate changes street by street.

Records the sale. Once the order is complete, it is reported to TaxCloud as a transaction. That record is what a return is built from, and what backs you up if a state asks questions later.

Keeps the record straight afterwards. Refunds and cancellations are sent back to TaxCloud too, so what it holds matches what actually happened in your store.

Applies exemption certificates. If you sell to resellers, schools or government buyers, a certificate held against a customer is applied automatically at checkout when it covers the destination state. This is off until you turn it on.

What stays your responsibility

The extension automates calculation and reporting. It does not make the decisions that come before them:

  • Where you collect tax. You choose your states in TaxCloud, based on where you have nexus. The extension charges tax where TaxCloud says to charge it.
  • What you sell. Tax depends on the kind of product. You tell TaxCloud what each product is by assigning it a TIC — a Taxability Information Code. Get that wrong and the tax is wrong, however good the calculation.
  • Your origin address. Many states tax based on where the order ships from. You enter that in Magento, and it must be right, down to the ZIP+4.
  • Exemption claims. TaxCloud does not verify them. If a customer is exempt, you are the one who must hold a valid certificate on file.
  • Filing. TaxCloud can file and remit for you, but that is a service you arrange with them — it is not something the extension switches on.

What it does not cover

  • The United States, and Canada if you turn it on. Orders shipping to Canada are taxed only once Canada is enabled on your TaxCloud account and in the extension — see Canadian tax. Orders shipping anywhere else are left alone, and Magento handles them however it did before.
  • Nothing is changed in your storefront's look. Tax appears in the totals the way Magento already displays it.

How the pieces fit together

Where What lives there
Your TaxCloud account The states you collect in, your business locations, your exemption certificates, your transactions and returns
Magento — TaxCloud Settings Credentials, and how the extension behaves: caching, logging, when orders are reported
Magento — products and categories The TIC for each thing you sell
Magento — customers Which customers are exempt, and under which certificate

Where to go next