Setting Up Sales Tax Collection

#Overview

CMS Max calculates sales tax based on where the customer's order will be delivered and where your business has a tax obligation. You can use a fixed per-state rate or TaxJar's address-level calculation. Once you select your tax locations, the system handles the calculation at checkout.

Note: Alaska, Delaware, Montana, New Hampshire, and Oregon do not have a state sales tax. Orders shipping to these states will never have tax applied, regardless of your settings.

For a complete guide to how tax is calculated and your TaxJar account options, see Sales Tax.

#Setting Up Tax Locations

A tax location (also called a nexus) represents a state where your business is required to collect sales tax — typically because you have a physical presence there, or because your sales volume in that state exceeds the state's economic nexus threshold. In Fixed Tax Rate mode, you can enter your own rate for a state or leave it blank to use the state-average default.

#Adding or Editing a Tax Location

1. Navigate to eCommerce > Store Settings.
2. Open Store Information.
3. Scroll to the Tax section.
4. Choose Fixed Tax Rate or TaxJar under Tax calculation method.
5. Select or remove states under States where you collect tax.
6. In Fixed Tax Rate mode, enter any overrides in Tax Rates, or leave a field blank to use the displayed state-average default.
7. Click Save.

Note: On multi-store sites, open eCommerce > Stores, edit any store, and scroll to Tax. These tax settings apply to the entire site, not only that store.

Repeat this process for every state where you are required to collect sales tax. If you are unsure which states apply to your business, consult a tax advisor.

Important: If a state is not selected, customers checking out with a delivery address in that state will see $0 in tax. Make sure every required state is selected.

#Quick Start: Collect Tax in Your Store's State

Turn on Use store address as tax origin in the Tax section, then save. Every US store's state is automatically added to your tax locations with the state-average rate. You can enter an override afterward if needed.

#Automatic Tax Collection When You Exceed Economic Nexus Thresholds

If your sales to any state reach that state's economic-nexus threshold (e.g., $500k in California), CMS Max automatically enables tax collection for that state — the state is added to your Tax Locations and collection starts on the next order shipped there. No action is needed; collection starts automatically to keep you compliant with the law.

If you believe you do not have a tax obligation in a state that was auto-enabled, remove it from the Tax section of Store Settings. It will not be auto-enabled again, even if your sales stay above the threshold.

#Assigning Tax Codes to Products

Most products use TaxJar's standard taxable rate. However, some product categories are taxed differently — or are exempt — depending on the state. For example, clothing under a certain price threshold is exempt in New York, or groceries may be taxed at a reduced rate.

Assigning the correct tax code to a product ensures the right rate is applied regardless of which state the customer is in.

#Setting a Tax Code on a Product

1. Navigate to eCommerce > Products and open the product you want to edit.
2. Open the Tax tab and choose a Tax Setting:
   • Default Settings — use the store-wide default tax category. This is the default.
   • Custom Product Tax Category — choose the appropriate category from the list.
   • Tax Exempt — mark the product as not subject to sales tax. Exempt products are excluded entirely from TaxJar calculations and order records; they contribute $0 in tax and don't affect tax on the rest of the cart.
3. Click Save.

Leaving a product on Default Settings treats it as fully taxable, or uses your store-wide default tax category if you have set one.

#Bulk Updating Product Tax Settings

1. In eCommerce > Products, select the products you want to update and choose Bulk Edit.
2. Use the Columns picker to show the Tax Setting column for row-by-row edits, or use Apply Tax Settings to All to update every filtered product at once.
3. Save the spreadsheet changes, or confirm the bulk apply action.

#Generating Tax Reports

CMS Max provides a tax report tool that lets you see tax collected broken down by jurisdiction (state, county, city, special district) and date range. This is useful for filing sales tax returns, particularly in states that require county-level reporting.

#Running a Tax Report

1. Navigate to Reports > Tax Report in the admin menu.
2. Set your Date Range (defaults to the last 30 days).
3. The report displays a breakdown organized by jurisdiction for the selected period.

The report shows columns for:

• Jurisdiction (state, county, city, or special district)
• Tax Collected (total tax for that jurisdiction)
• Taxable Amount (the subtotal that tax was applied to)
• Tax Rate

Note: Summarized-rate orders only show state-level breakdowns. County, city, and special-district rows appear only for TaxJar-priced orders. If a jurisdiction appears as "Unclassified," the system was unable to retrieve the name — typically because the order's address was entered incorrectly at checkout.