Tax rates are easy to set up. You may set up multiple tax rules for a single state and you may also set up tax rules for multiple states. Tax rules may also be set up for countries besides the United States.
To set up a new tax rule, click the "Add Another Tax Rule" link.
State / Province / Country - Select the state, province, or country that this rule will apply to.
From Zip & To Zip - This allows you to set up a range of zip codes. For example if tax rates vary within the same state, you can set a range of zip codes to charge taxes in. You may enter a full 5 digit zip code, or the first 3 digits of a zip code. If you want to use the entire state for this rule, then do not enter any zip codes here.
Tax Rate - Enter the tax rate for this rule. The number that you enter here is a percentage of the total taxable amount of the order (not including shipping).
Tax Shipping - Some states require that shipping be taxed. If you would like to tax shipping, enter the tax rate here. In most cases, this will be the same as the Tax Rate. If you will not be taxing shipping, then leave this set to 0.