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Calculate Taxes In Your Store

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Using your Gator account makes it easy to collect taxes in your eCommerce store without you having to deal with any advanced calculations. Once you turn on "taxes" in your store, and the internal tool will begin calculating each time your customer purchases one of your products based on the preset state taxes from where they're buying, automatically. 

In this article, we will cover How to Enable Tax Calculation from your store so that you can begin accounting for this universal aspect of doing commerce.

Frequently Asked Questions about Automatic Taxes:

How are taxes calculated?
Your HostGator store will check your customer’s billing address to your store’s address as a nexus. From there, it will determine the appropriate State taxes that should be applied. For Example: Using automatic tax settings means customers in your State will automatically see a tax rate of a set amount, while customers from an outside state will not see taxes applied to their cart.
Why did my store not charge tax on an order?
The most common reason is that your client is in a different location than your store. If you have tax entities or multiple Nexus, we suggest using the manual tax option to enter the taxes per region/state. 
What system does HostGator use to calculate taxes?
We use integration with TaxJar to calculate the current tax rates for various states and regions. For more information about their product, you can check out their Help Center.

Enabling Tax Calculation:

To switch tax calculations "on" or "Enable Tax Charges " in your store, follow these steps:

  1. First, begin in your store dashboard.
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  2. Next, select the Settings option in the left-hand column.
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  3. On the new page, scroll down to the Taxes area and click Edit.
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  4. Then switch the toggle On to enable taxes.
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  5. This toggle will reveal the option for taxes to be calculated automatically or for you to enter tax rates per region manually. Pro Tip: If you are unsure what rates to charge here, please consult your tax professional and, when possible, use our automatic tax settings to make eCommerce easier. The tax calculation uses the billing address provided by the customer to calculate state taxes, so for you, it is worry-free; where ever your customers are located, they will be charged at the correct tax rate, and you will both be able to see these charges reflect on each of your statements.
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  6. Once you have made your desired selection, you are ready to start charging taxes on orders moving forward. These tax calculations happen automatically, and there is no additional setup required. Once you turn on tax calculations, customers will see taxes applied to their cart automatically at checkout, if applicable:
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