Set up US tax jurisdictions and rates
Add the states, counties and cities you collect sales tax for, and their rates.
For US companies, Legasum calculates sales tax from rates you enter. Nothing is pre-loaded, so until you add a state and a rate, invoices carry no tax. Open Accounts > Tax Jurisdictions or go to Tax Jurisdictions (the page is titled Tax Jurisdictions & Rates).
Who can use it
The menu item appears only for the company owner of a company whose country is the United States. Other members of the company can open the page and read it, but only the owner sees the buttons to add or change anything. If you are not the owner, ask the owner to configure it: the page tells you "Ask your company owner to configure one."
The jurisdictions and rates are shared reference data for the US sales tax scheme.
Add a state
- Click Add Jurisdiction.
- Set Level to State.
- Enter a Code in the form US- plus the two-letter state code, for example US-CA, and a Name, for example California.
- Click Add Jurisdiction to save.
The code matters: Legasum finds a customer's jurisdiction by matching "US-" plus the state in the customer's billing address, so the customer's state field should hold the two-letter code (for example CA).
Add a county or city
Add another jurisdiction with Level set to County or City, and choose its Parent. A county's parent is a state. A city's parent is a state or a county. Give it a code and a name. When an invoice's customer city matches a city or county name under their state (not case sensitive), that more specific jurisdiction is used.
Add a rate
- On the jurisdiction's row, click Add Rate.
- Choose the Component: State tax, County tax or City / local tax.
- Enter the Rate % (0 to 100) and the Effective From date. Effective To (optional) ends it on a date.
- Click Add Rate.
The row then lists its current rates, for example "State tax: 7.25% (from 2026-01-01)". Rates are added, never overwritten: to change a rate, add a new one with a later Effective From. The rate used on an invoice is the one in force on the invoice date. Rates apply to the Taxable category; Tax-exempt lines never get tax.
For a customer in a city, Legasum looks at the city, its county and its state, and for each component (State, County and City / local tax) uses the rate it finds along that path. The components are added together.
Switch a jurisdiction off
Deactivate hides a jurisdiction from tax calculation without deleting it. Activate brings it back. A jurisdiction with no active rate shows "No active rate configured yet."
Good to know
- The customer's state and city come from the Billing Address on their customer page, so keep those filled in. See Add and manage customers.
- Legasum does not determine whether you have to collect tax in a state, and does not file returns. It only applies the rates you enter.
- To see tax collected per place, run the US Sales Tax by Jurisdiction report.
- How the whole calculation fits together is in How tax is calculated.