Setting Up AvaTax

As part of your aACE+ AvaTax integration, you can configure various aACE settings, in the following sequence:

  1. Accounting preferences
  2. Office settings
  3. Line item code settings
  4. Tax profiles

The first thing you'll need to do is reach out to and open an account. When you do this, indicate that you will be using "aACE" so they can configure your account appropriately by adding the correct connector.

1. Configuring Accounting Preferences

To enter your AvaTax credentials and basic setup information, navigate to Menu > Accounting > Preferences > AvaTax:

  • Enable AvaTax — Mark this flag to set other integration details.
  • Account Number, License Key, and URL — Enter the Account Number, License Key, and URL provided by Avalara in an email with the subject "Important! Your [Production/Development] Account Number & License Key". The URL is most likely but if you experience difficulties, check with Avalara. To test your connection, click the Test button adjacent to the Enable AvaTax checkbox.
  • Enable logging — Mark this flag to enable advanced logging for the AvaTax integration.
  • Disable address validation — Mark this flag to turn off automatic address validation when creating or updating applicable records (i.e. companies, orders, invoices, etc). Note: With automatic address validation enabled, you can still manually validate an address.
  • Disable tax calculation — Mark this flag to turn off automatic tax calculations when saving orders and invoices.
  • Use tax codes from order when invoicing — Mark this flag to pull the AvaTax code from the related order item instead of the line item code (LIC). This keeps the tax values consistent between the order and the invoice, even if the LIC settings change between when an order is placed and when it is fulfilled.
  • Filter Address Validation by Country — A return-delimited list of all countries that should be included in the address validation feature. If a country is not on this list, it will not be included in automatic or manual address validation.

2. Configuring Offices

aACE Office records correspond to AvaTax Company records when setting up multiple entities in your AvaTax system. Navigate to Menu > Internal > Offices. In the AvaTax Co Code field, enter your AvaTax Company Code. Note: This is not your AvaTax Company ID. The Company Code can be found by logging into your AvaTax portal and navigating to Company Settings.

3. Configuring Line Item Codes

LICs are your products. Navigate to Order Setup > Line Item Codes:

You can enable AvaTax for each LIC from the Preferences section by marking the Enable AvaTax flag. You can also set an optional tax code that AvaTax will use to calculate tax rates for basic users. (For details, contact your Avalara representative.)

You can also update these settings for batches of existing LICs:

  1. At the Line Item Codes list view, locate the LICs that need to be updated.
  2. In the footer, click the Admin Actions icon ().
  3. Click the link for the desired update:
    • Update AvaTax Tax Code for Line Item Codes in List — Continue the import process, preparing an Excel spreadsheet with the correct tax code for each LIC, then importing that data.
    • Update AvaTax Setting for Line Item Codes in List — At the confirmation dialog, click Y-True to enable AvaTax for all listed LICS. You can also click Y-False to disable this setting for all listed LICs.

4. Configuring Tax Profiles

aACE Tax Profiles can be set up in different ways depending on your implementation. Navigate to Menu > Accounting > Tax Profiles:

For the AvaTax integration, any record linked to a tax profile that has the AvaTax flag marked will be processed through AvaTax; conversely, any tax profile with this flag cleared will bypass the AvaTax calculations.

The simplest implementation is to have a single, default tax profile with AvaTax enabled. All records would be assigned to this tax profile, all taxes would be calculated via AvaTax, and all taxes could be associated with a generic tax GL account.

Additional tax profiles can help if:

  • You want the tax values calculated by AvaTax to be tracked in the GL using various criteria. For example, you may want a different tax GL Account for each state you do business in, in which case you’d need a different tax profile for each state.
  • You want the AvaTax tax calculation to be disabled for a certain group of companies, such as jurisdictions for which your AvaTax account is not set up to calculate.
  • If you are setting up new tax profiles for each AvaTax nexus, be sure to associate postal codes with the appropriate tax profile.

For additional details about integration with existing tax profiles, see Overview of AvaTax integration.