Sales Tax Fundamentals
Get up to speed on the basics of sales tax
Quimbee is an online legal education company. Quimbee provides study aids to help law students prepare for classes and exams, exam-prep courses to ensure law grads pass the bar, and continuing legal education (CLE) programs to satisfy attorneys’ CLE obligations. Different subscription packages allow Quimbee users to select the service that best fits their budget.
Because Quimbee sells to students nationwide, the Wayfair decision in 2018 meant Quimbee would be required to collect and remit taxes in almost every state. After researching sales tax service providers, Quimbee landed on TaxJar.
Now, the Quimbee team rests easy knowing their sales tax collection is being handled by TaxJar’s sales tax experts.
From simple to complex
The Wayfair decision in 2018 changed everything for Quimbee. For a fully remote, digital business, the idea that their small team would suddenly have to manage sales tax in multiple states was overwhelming. DeAnna Swearingen, Chief Operating Officer at Quimbee, said, “Just keeping track of the nexus requirements for every state has been a challenge.”
Quimbee sells digital products exclusively. Prior to 2018, being sales tax compliant was a simple process for the company. “The Supreme Court’s decision in Wayfair made it clear that we could be required to collect and remit taxes in pretty much any state, even if we had no physical presence there. That was a wakeup call for us.”
To help determine where they have nexus, Quimbee engaged with an accounting firm to do a nexus study, leading them to research a sales tax provider that could help manage sales tax collection in multiple states.
Determining the right sales tax solution
Quimbee participated in demos for each sales tax compliance tool that offered integrations with its billing platform. In the end, the Quimbee team narrowed down the contenders to TaxJar and Avalara using a list of must-have attributes to make their final decision.
They wanted a tool that:
- allows them to fully automate the sales tax process
- stays up to date with changes in tax laws and rates nationwide
- alerts them if they near economic nexus thresholds in a new state
After reading through the extensive and informative TaxJar blog and knowledge base, it became clear to Quimbee’s team that the TaxJar team met — and exceeded — their requirements, specifically with respect to staying on top of the latest sales tax news and providing a built-in Economic Nexus Insights tool, so Quimbee could avoid doing additional nexus studies in the future, saving the team time, money, and effort.
Ultimately, Quimbee decided to become a TaxJar customer based on price and value. DeAnna remembers, “TaxJar stood out because it really met all our requirements while delivering the best value for the price.”
Building a custom integration with TaxJar in a two-week sprint
Once the Quimbee team selected TaxJar, the next step was to determine how they would integrate the solution with their billing platform. After much thought and consideration about the right way to integrate, Quimbee decided it would build a custom integration with TaxJar.
“We were somewhat concerned about the time and resources that building a custom integration would demand of our tech team,” said DeAnna, “but the docs were really comprehensive, and TaxJar made its engineers available to hold our hands along the way.”
TaxJar’s collection of resources for developers made the entire onboarding process go as smoothly as possible. In addition, the TaxJar team created helpful tasks and to-dos within the TaxJar internal project management system, making it extremely clear what the Quimbee team needed to do and when.
The custom integration was built in a two-week sprint, with only one dedicated developer working on the project. “I cannot say enough good things about the implementation and onboarding process,” DeAnna said. “We were really pleased with how smoothly everything went.”
Using AutoFile in 33 states, and counting
With TaxJar set up and running smoothly, Quimbee took the next time and money-saving step: enrolling in AutoFile for all 33 states. Now, the only thing the Quimbee team does is check in on the reports, and they let TaxJar handle the rest.
“Without a doubt, we utilize the AutoFile feature most frequently.” In fact, without TaxJar, Quimbee would have likely had to hire someone to manage their ongoing sales tax compliance.
In addition to AutoFile, Quimbee also takes advantage of the Transaction Insights tab, a feature that highlights when there is a variance between what was actually collected and what TaxJar’s system expected Quimbee to collect. The tool makes it easy for Quimbee to quickly find and fix minor issues before they snowball into major problems down the road.
A consistent level of service
When asked what advice DeAnna has for other web-based companies searching for a sales tax solution, she said companies should look for a team that will work closely with you throughout the implementation process to ensure things are running correctly, and that will offer ongoing customer support.
“I can’t say enough about how grateful we’ve been for the level of service the TaxJar team provides, and how useful the product has been,” DeAnna said. “TaxJar has been really great about helping us with whatever issues we have and being proactive about making sure [the product] is working for us. For example, our business is very seasonal. Our account manager monitored our usage and helped make sure we were on the right plan. She even reached out to help us move to a less-expensive plan. TaxJar clearly has our best interests in mind.”
TaxJar was really a no brainer. Not only did it offer all the features we were looking for and genuinely excellent customer service, but the pricing model made the most sense for our business.