Like most companies, HOA Express is required by state and local jurisdictions to collect and remit sales tax for most services sold by our company. This article explains when and why sales tax is collected, how it’s calculated, and what steps to take if your community is exempt from paying sales tax.
What’s taxable and how it’s calculated
In jurisdictions where HOA Express is required to collect and remit sales tax, most of the services sold by HOA Express are taxable. We partner with a third-party provider and consult with the sales and use tax team at our accounting firm to determine taxability, identify tax rates, and calculate sales tax in accordance with relevant tax laws. These tax laws are constantly evolving, along with the requirements and metrics that impact whether we are required to collect and remit sales tax in particular jurisdictions.
We rely on a community’s stored location when determining taxability and calculating sales tax. Therefore, it’s important that this location is accurate. You can update your community’s stored location in the Admin Portal. In some jurisdictions, the location of our company’s headquarters may also be a factor.
Exactly how sales tax is calculated is often complicated and can vary significantly between jurisdictions. Additionally, sales tax isn’t always calculated on the total charge amount—portions of a charge can be considered tax-exempt under some state and local tax laws.
If we are required to collect sales tax for a service sold to your community, our platform will indicate this prior to making payment (generally by adding a “+ tax” suffix to the displayed price). After the payment is made, the receipt will list the sales tax amount as a separate line item.
Submitting a tax exemption certificate
If you believe your community is exempt from paying sales tax, please send a completed and signed exemption certificate to our customer success team (how to contact us). Our team will then review the exemption certificate, and once verified, your community will be marked as tax-exempt going forward. Please note we cannot issue refunds for sales tax collected prior to receiving an exemption.
You can obtain a sales tax exemption certificate from your state. For any questions regarding your community's tax-exempt status or how to fill out the certificate, please consult a knowledgeable accountant or attorney.