This section lists the steps that should be followed in order to implement the sales tax certificate management system.  These steps should be followed if you ff you are implementing sales tax certificate management for the first time on an existing system or if you are converting to StreamV from another system.  Please note, the below is an overview and additional information about the steps listed below is provided in a later sections of this document.

•      Set up the TaxType Table.  The Tax Type Table determines the customer type or shipto address tax type for sales tax purposes.  Normal entries in this table include RETAIL (taxable sale), RESALE (nontaxable sale due to resale certificate received for the customer), GOVT (nontaxable sale due to sale to govt agency), and Export (goods exported overseas).

•      Determine which states you have Nexus in.

•      Set up the Taxcodes for each of the states in which you have Nexus.  The Taxcode records in your system define each of the geographic tax districts in which you are required to collect tax, the rate that applies in each tax district, whether shipping is taxed in the district, and the autopost number used by the system when posting sales tax collected in the district.  Depending on the state, and the number of locations that you maintain in the state, you may require one or more taxcodes for the state.  For example, if you have Nexus in a state, but no physical presence (ie no sales or warehouse locations in the state), you may be able to charge one rate for all taxable sales into the state.  In this case you might have one taxcode record for HI (entire state of Hawaii), with a single rate used for all deliveries into HI).  If you are doing business in a state with multiple tax districts and rates, and you must report on and collect tax for each district, you may need multiple records in the Taxcode table for the state.  For example, you might have one taxcode for each taxing district for a state like California (ie ALAMEDA 7.75%, SBCOUNTY 7.5%, LACOUNTY 7.75%).  Normally a TaxCode NO TAX is also entered into the Taxcode table with a 0 rate, and this record can be used to handle states in which you don’t have Nexus (ie RETAIL TaxType would indicate sales is taxable (due to no resale# on file), but the NO TAX Taxcode with the 0.00 rate is used for the States in which you don’t have Nexus and this Taxcode prevents the system from charging tax on the shipment.

•      Optionally load the zipcode table with the correct Taxcodes.  The System supports autoloading the Taxcode in new customer and shipto records based on the zipcode in the customer or shipto address.  The system also allows you to manually assign the taxcodes for each new customer and shipto (based on security settings). 

•      Load the correct taxtypes and taxcodes into the customer and shipto records in the system.  This can be done using the sales tax utility programs, using standard loaders or using custom data conversion or data processing programs.

•      If you have certificate information in your existing shipto records, you may create certificate records automatically from this information.   The character program fv108t04 will scan through your existing shipto records and it will create certificate records for each shipto record for each customer that contains certificate information.

•      Clean up any duplicate, expired or invalid certificate records (you may use the Longcode Manager or the Tax Certificate Lookup program to access and edit the certificate records for each customer).

•      Set the system parameter SOEDEFST – to N.  This forces the use of shipto records on all sales orders and this behavior is mandatory when the sales tax certificate management options are being used.  The certificate number and expiration date are carried in the shipto records, so a shipto record must be used each time a sales order is entered into the system.

•      Set the system parameter TAXCERTIA to N for any groups, branches or users who are not allowed to create or edit certificate records.  Create another version of the same parameter and set to Y for any users, groups, branches that are allowed to create or edit the certificate information.

•      Set Set up the SOHOLD-N parameter in the System Control File – this record determines who the Nexus or sales tax hold is assigned to by the system.  If this record is not present, the system will not place a sales tax hold on resale orders.

•      Determine who is allowed to release N holds and add the N to the SORELPRV record used for the operators (to allow them to clear the N holds).

•      Set up the Textdata system control record that defines the states in which you have Nexus.   This step can be done at once – ie add all states where you have Nexus, or you may implement the system on a state by state basis (ie add one state to the nexus record at a time to allow entry and cleanup of the certificate information for one state before adding the next).

•      Set up the Vendor Nexus records for any vendors who require you to forward sales tax certificate information.  The Vendor Nexus records are used to test if a tax certificate number is required by the vendor in a particular state, and they are used during PO Requisition processing.  If a vendor ship sales order line is processed in the requisition program, and the order is a resale order, and the vendor nexus record indicates they have nexus in the state in which the order is being shipped, the system will block conversion of the PO Requisition into a PO until valid certificate information is present in the sales order.   


Sales Tax Operations Programs