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NY State sales tax(Help req.)

Arrgghhh... One of our customers has a branch in NY running our software, we don't normally recommend this as the US sales tax stuff is something we don't like dealing with.
However since the rate has now gone up to 8.625% and we only store our tax rate to two decimal places we have a problem, particularly as the customer sells stuff priced in thousands of dollars.
I've been to the state tax site at but I can't find out any rules as to how to round for tax purposes and if it's acceptable to round the tax to 8.62% or 8.63%. (oh and what should happen on items costing 5 cents each)
So does anyone know? Can they point me to a document on a state/city website which says anything at all about this?
Finally why in this computerised age do they insist on using fractional tax rates? :(

Peter Ibbotson
Tuesday, June 17, 2003

8.625%  i knew i left ny for some reason  :)

Tuesday, June 17, 2003

When you actually file your quarterly sales tax forms, you end up summing up the total sales per tax jurisdiction and multiplying THAT by the tax rate, so the final number you get is always a few cents off the amount you collected from customers. Besides which on the sales tax filing many things are rounded to the nearest dollar.

As long as you're not >over<collecting I assume that you won't necessarily get in trouble, but ASK A CPA don't trust me.

Joel Spolsky
Tuesday, June 17, 2003

Ah... so you could in theory use a rounded rate and take the hit. Over here with VAT the total is always the same as the one you charged the customer so you have to get it right. (Actually this isn't strictly true for small operations but I'll ignore them)
Since these guys sell big ticket items we have a work around for them anyway temporarily.
Sadly accountants and tax inspectors often don't understand the rules properly (been there had that argument) and as software authors we often know more than they do.

Peter Ibbotson
Wednesday, June 18, 2003

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