My location is in Colorado. If I sale to anyone in my state it only charges the 2.9%, but it should charge an extra 1.1% for special district taxes. I also have a problem charging the local taxes if I ship to anyone within my city & county. I’ve tried to set up the override on the products but it still doesn’t work. I am using square checkout if that makes a difference.
I live in Colorado and specialize in eCommerce sales tax nexus. You are required to collect sales tax at your physical location rate until you reach over $100k in sales. Once you meet this threshold, then you must collect/report/remit for all 700 Colorado taxing jurisdictions and 74 home rulers.
Have a CO shop. We are far under the $100k in sales within CO. We we have been refunding the county and municipal taxes to every CO purchase. Why, because we would have to manually make an exception for EVERY municipality and county in CO. That is 700+ exceptions as @eCommAccountant typed earlier.
After multiple phone calls and service emails, we can not get Shopify to just make a rule for this exception. So it is EXACTLY how shopify had our taxes collected pre 2020 and they will NOT move a finger.
We are shopping around and plan to leave Shopify for this reason. The sales we have and the fees we pay with Shopify currently, you would think they would consider making this (simple on their end) change and not loose our revenue.
The $100k threshold is all sales, not just sales to Colorado addresses. Also when you're under the $100k threshold, Shopify should be set up as origin sourcing not destination, which will be about 85% correct when Shopify calculates/collects the sales tax rate.
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