Using the new US taxes feature

If you're already using Shopify to sell in the United States, then you can update your US sales tax settings to reflect your tax registrations. This change doesn't affect how sales tax is charged on your store. If you aren’t registered to collect sales tax in any states listed in your tax settings, then you can remove them.

When you update your tax settings, you're asked to provide a tax registration number. After it's been added, Shopify automatically sets the tax rates that apply in the areas you've registered for.

Shopify support can help you update your tax settings in your Shopify admin, but can't provide legal tax advice. If you need help changing your tax settings, then contact support. If you need help understanding your tax obligations, then contact US state tax authorities or a tax professional.

Do I need to register to charge taxes?

It depends. In general, you're obligated to collect tax in any US state where you both sell taxable goods or services, and have economic nexus.

For more information, refer to US taxes reference. If you're unsure whether you need to register for a tax account, then reach out to US state tax authorities or a local tax professional.

What's a sales tax ID? Do I need one?

A sales tax ID is a number provided to you by your state tax authority after you register with them to collect taxes. This number is issued by states to allow you to charge taxes there.

You need a sales tax ID number only if you determine that you need to charge taxes in a particular state.

How do I know if I need to register?

Typically, you need to register if you have economic nexus in a state. What constitutes nexus in each state can differ. Some states require you to register and collect taxes only if your business is physically located within that state, while others might require you to register based on distribution centers or advertising within those states.

If you have any significant presence in a state, then you should contact its tax authority to confirm whether you need to register to collect taxes. For more details, see US taxes reference.

I need to register. What do I do?

If you need to register to charge state taxes, then you can do so on that state's website.

After you've registered, add your sales tax ID number on the Taxes page.

Steps:

  1. Go to Settings > Taxes.
  2. In the Tax regions section, beside United States, click Set up or Edit.
  3. In the Tax registrations section, click Add tax registration.
  4. Select a region in which you are registered.
  5. In the field below your selected state, enter your account number.

You can delete or change your registrations or account numbers with the ... button next to the state name and account number in the Tax registrations section.

Will I be able to override tax settings?

Yes. For more information about how US tax overrides are affected when you update, refer to Override taxes.

Where can I go for more help?

Shopify support can help you with how to change your settings, but can't advise you on if you should change your settings. If you need help determining if you should register with tax agencies and charge taxes to your customers, then your best resource is a local expert, such as an accountant or financial advisor. You can also reach out to individual tax agencies directly.

I've updated my tax settings. Why am I getting different tax amounts?

In some orders, you might notice a small variance in your total tax amounts after you've updated your tax settings. This variance is due to tax amounts being rounded at the line-item level, rather than at the invoice level. You can learn more about rounding calculations in Setting up US taxes.

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