Sales tax sourcing determines where sales tax is applied and collected when a transaction occurs.

**Sales tax sourcing** determines *where* sales tax is applied and collected when a transaction occurs.

* **Origin-based sourcing** means the tax rate is based on the seller’s location: state, county, city, and possibly local district where the business is located. You charge the same rate to every in-state buyer.
* **Destination-based sourcing** means the tax rate is based on the buyer’s location: the delivery or destination address. Rates can vary widely depending on where the customer is located.


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## Why It Matters

* **Origin-based** states are easier to manage for sellers, since they charge one rate statewide.
* **Destination-based** states are more complex, requiring sellers to calculate taxes based on each buyer’s jurisdiction, which may require tax software or tools.


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## State-by-State List

### Origin-Based States (in-state sales follow seller’s location)


 1. Arizona
 2. California \* (state, county, city taxes from origin; district taxes from destination)
 3. Illinois
 4. Mississippi
 5. Missouri
 6. New Mexico
 7. Ohio
 8. Pennsylvania
 9. Tennessee
10. Texas
11. Utah
12. Virginia

California is a **hybrid**—it uses origin-based sourcing for state/county/city taxes but destination-based for district taxes.

### Destination-Based States (tax based on buyer’s location)

* Alabama
* Arkansas
* Colorado
* Connecticut
* District of Columbia
* Florida
* Georgia
* Hawaii
* Idaho
* Indiana
* Iowa
* Kansas
* Kentucky
* Louisiana
* Maine
* Maryland
* Massachusetts
* Michigan
* Minnesota
* Nebraska
* Nevada
* New Jersey
* New York
* North Carolina
* North Dakota
* Oklahoma
* Rhode Island
* South Carolina
* South Dakota
* Vermont
* Washington
* West Virginia
* Wisconsin
* Wyoming
  * **New Mexico** is sometimes listed as destination-based, depending on sources, but it’s also included in origin-based lists


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## Additional Context: Remote Sellers & Nexus

* Regardless of origin/destination rules for in-state sales, **remote sellers** (sellers without physical presence in a state but with “economic nexus” due to sales thresholds) are usually **required to follow destination-based sourcing** when selling into other states. 
* Some origin-based states (notably Arizona, California, New Mexico) may have unique or transitional rules for remote sellers, but destination-based sourcing is increasingly standard.




What is Sales Tax Sourcing?

Is shipping taxable?

Managing Product TIC Mapping with Product Catalog

Sales Tax Holidays & Product Codes (TICs)

TaxCloud Taxability Information Codes (TIC)

Taxability and TICs

Calculating sales tax on Digital Goods

Calculating sales tax on P.O. Boxes

Does TaxCloud Calculate Sales Tax for International Orders?

Guidelines on When TaxCloud May Cover Penalties and Interest (P&I) for Sales Tax Fiilings

How does New York handle sales tax on apparel under \$110?

How does TaxCloud round sales tax?

Is the plus 4 zip code extension (9 digit zip) required to calculate sales tax?

Understanding the difference between sales tax and use tax

What is Streamlined Sales Tax (SST) and do they cover TaxCloud services?

How do I know if I've reached Economic Nexus in a state?

What is Nexus?

What is Washington B&O Tax?

Tax Concepts

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How do I change my default payment method?

How to Add a Payment Method in TaxCloud

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I have a new EIN. How does that impact my TaxCloud account?

How to Close Your TaxCloud Account and Cancel Subscription

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Video: How to complete your TaxCloud Business Profile

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How to Enable & Disable Tax Collection in a State

How to Update My New Business Address With The States?

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Fee Schedule: Understanding TaxCloud Fees

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TaxCloud's APIs

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How do I find my Merchant Number?

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What Services Does TaxCloud Provide?

What happens if I go over my allotment of orders?

What is a voluntary seller?

What is an order in TaxCloud?

Can TaxCloud help with my State Income Taxes?

How to Speak to a Member of Each State's Tax Authority or Department of Revenue

How to Speak to a member of each state's DOR

What are Home Rule States?

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Does TaxCloud collect the Colorado Retail Delivery Fee (CO RDF)?

Understanding the Minnesota Delivery Fee

General

What is an Exemption Certificate?

How to Upload Exemption Certificates in Bulk

How to Add an Exemption Certificate to TaxCloud

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TaxCloud Audit Support Overview

Support and Resources

Michigan - Business Taxes Registration Summary of Changes

Rhode Island - Failure to Renew

Colorado SUTS Filing Reminder Notices

Texas - Notice of Tax/Fee Due

Texas - Sales & Use Tax Return Paper Form

Florida - Credit Memo

Florida Hunting, Fishing, and Camping Sales Tax Holiday (Sept 8 – Dec 31, 2025)

Arkansas - Excise, Waste Tire or Withholding Wage Tax

Louisiana State Sales Tax Rate Update

Does TaxCloud Handle Sales Tax License Renewals?

How to register in a new state and obtain my Sales Tax License

Indiana - Notice of Proposed Assessment

Nebraska - Enforcement of Lien Notice

New Jersey - Certificate of Registration

North Carolina - Certificate of Registration

Tennessee - Notice of Overpayment

When To Forward a State Notice to Taxcloud

Wyoming - License Certificate

Connecticut - Delinquency Notice

California - CDTFA Statement of Account

State Notices and Licenses

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How to Import Partial Refunds via CSV

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Why are exempt sales taxing in my import?

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How to Upload Transactions via CSV

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How to Locate a Transaction URL in TaxCloud

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Understanding the differences between TaxCloud Tax Reporting and Your Platform's Tax Reporting

When does TaxCloud pull my tax funding?

Understanding Tax Reports and Drilling Into Transaction Details

Reporting

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Managing Your Tax Thresholds

South Dakota - Sales & Use Tax Return Paper Form

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Filing: State-Specific Workflows

Enabling Filing in TaxCloud (via Thresholds Page)

How can TaxCloud assist with Filing?

How do I confirm my filings have been submitted in SST / Streamline member states?

How do I know if TaxCloud is filing for me in a state?

I just got a filing frequency change notice, what should I do?

Understanding TaxCloud's Filing Costs & Filing Subscription

Why might my Direct Filing ACH be less than what TaxCloud is saying I collected.

How to Request TaxCloud to Begin Filing Sales Tax Returns

How to Stop Filings with TaxCloud

Filing: Managing Filing in TaxCloud

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Understanding Your Tax Reporting Page

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Filing: General

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QuickBooks Online Integration: How to Resolve a Missing Account, Product Code, or Sales Tax Item Error

Troubleshooting QuickBooks Online Tax Calculation Errors

Managing your QuickBooks Online Product Catalog TICs in TaxCloud

Calculating Sales Tax on QuickBooks Online Invoices

Calculating Sales Tax on QuickBooks Online Sales Receipts

Calculating Sales Tax on Estimates

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QuickBooks Online

How to Download Debug Logs in TaxCloud for WooCommerce

Connecting TaxCloud to WooCommerce

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How to Configure WooCommerce Order Capture Behavior with TaxCloud

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How to Enable Rate Limiting in TaxCloud for WooCommerce

WooCommerce-Plugin-Settings-Reference

WooCommerce

How to connect my Odoo store to TaxCloud

How to Connect my TaxCloud Account to Odoo Sale (Loyalty)

How To Connect my TaxCloud Account to Odoo Sale (Loyalty) - Delivery

How to Connect my TaxCloud Account to Odoo eCommerce

How to Connect my TaxCloud Account to Odoo Sale

How to Connect my TaxCloud Account to Odoo Amazon/TaxCloud Bridge

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Odoo

Connecting TaxCloud to BigCommerce

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BigCommerce

Connecting TaxCloud to Shopify

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How to Mark Customers Tax Exempt in Shopify

Shopify Reporting FAQ

Shopify

Connecting TaxCloud to Miva

Miva

Connecting TaxCloud to Chargebee

Chargebee

Connecting TaxCloud to Adobe Commerce or Magento

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Adobe Commerce & Magento

Integrations