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Taxation in US Accounts

Updated

In the U.S., taxes are determined and can differ on a federal, state and county level. Taxes can also change frequently, even on a monthly basis, so users might miss updating them

You can now set up your taxes to automatically update based on your ZIP Code. No need to manually look up the tax and update the rates manually. You can then also assign a specific tax scheme to contacts and designate which equipment is taxable and which is exempt.

Setting Up Tax Scheme

Tax rates can vary per ZIP Code. In the Configuration module, you can set up different Tax schemes with fixed rates.
Screenshot 2024-09-19 at 10.47.43.png

Marking Equipment as Taxable

You can choose which equipment is taxed and which is exempt. Here's how:
  1. Add (or edit) equipment.
  2. In the Data tab, go to the "Financial" section.
  3. Choose between "Taxable" and "No tax" in the "Taxable" field.

You can also edit this information in bulk, and change this information in the Equipment tab of your projects.

Tax Scheme for Specific Contacts

You can choose which rate to apply to each contact. Here's how:
  1. Add (or edit) a contact.
  2. Go to the Payment tab.
  3. In the "Payment information" section, select a Tax scheme in the "Tax rate" field.

When you add a contact as a client or a location to your project, Rentman will ask you if you want to apply this rate.

It is also possible to manually apply a different rate in your project.

Auto-Generating Tax Rates by Location

This feature automatically generates accurate, up-to-date tax rates for any location by entering a ZIP Code. It removes the need for manual updates by providing live tax information and applying the latest rates as they change, ensuring accurate billing and reducing the risk of financial penalties.

Rentman automatically updates tax rates on the 1st of every month if changes occur and a history of tax rates is built up for easy reference.

colour: #990099;"Please note, this feature is available for accounts with the Quoting & Invoicing add-on.Quoting and Invoicing

How to Use It

Using the US Tax Rates feature is simple and efficient. Follow the steps or check out the videos below.

How do I add a new tax rate?
  1. Go to the settings Configuration module in Rentman and navigate to Tax rates.
  2. Click on colour: #0000FF;"add Add tax rate in the right corner on top.
  3. Search for the ZIP Code for the location where you're doing business.
  4. Add a descriptive name for the tax rate and click Confirm.
  5. Save the changes.
  6. Rentman will automatically generate the correct tax rate based on the ZIP Code, and it will be updated monthly if there are any changes.
  7. A history of each tax rate will be maintained from September 2024 onwards, allowing you to track past rates.

add tax rate.gif

How to convert an existing tax rate into a ZIP Code-linked tax rate with automatic updates?
Linking a tax rate to a ZIP Code ensures your system stays updated with any changes in local tax rates. By connecting the rate to a ZIP Code, Rentman will automatically update it if the tax rate changes, saving you the need to do it manually.
  1. Go to the settings Configuration module in Rentman and navigate to Tax rates.
  2. Click on the tax rate you want to edit, then click edit Edit.
  3. Search for the relevant ZIP Code.
  4. Confirm and Save the changes.

edit existing taxrate.gif

Whenever a tax rate is updated, Rentman will notify you with a short message in the Financial tab of your project. This ensures that you are always aware of any changes to the rates applied to your invoices.

FAQs

What happens if the tax rate changes mid-month?
Tax rates are updated automatically on the 1st of each month. If a rate changes mid-month, it will be reflected in the following month's update.
Can I still manually update tax rates?
Yes, you can manually adjust tax rates if needed. However, the automatic updates ensure you’re always using the most accurate rates without manual intervention.
How do I know if the tax rate has been updated?
Rentman will notify you with a message in the financial tab of your project whenever a tax rate is updated.
Can I see the history of tax rates?
Yes, Rentman allows you to view the history of tax rates that are stored in your database, starting from September 2024. This helps you reference previous rates accurately, based on the data you've entered.
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