Setting Up a Sales Tax Cap in MaxxTraxx

Setting Up a Sales Tax Cap in MaxxTraxx

Some states cap the total sales tax that can be collected. If there’s a maximum taxable amount, you can set this up using Tax Code 5.

Steps:

  1. Go to: Setups → In the Accounting column E, click Sales Tax Rates.
  2. Click Add Tax Rate.
  3. Fill in:
    • Tax Code
    • State/Province District
  4. Check Use Tax Type 5 (Special Option).
  5. Fill in:
    • Description
    • Part/Labor Rate (tax rate), e.g., 9.75%
    • Maximum Dollar Amount to Tax — this is the sale amount on which tax will be applied, not the tax amount itself.
  6. Click OK.

How to Calculate the Maximum Dollar Amount to Tax:

  • Example: If the maximum tax collected is $500 and the tax rate is 9.75%:
  • $500 ÷ 0.0975 = $5,128.21

This means only the first $5,128.21 of the sale will be taxed; anything above that amount will not have additional sales tax applied.

 


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