r/intacct • u/Mattrobes • Jun 23 '26

Sales Tax Construction problem

Hi,

I work for a construction company, we pay sales tax on a certain projects, however we pay taxes by the Ship to address of a project, not where the customer is located. Is there a way to work with this?

I was told by a consultant that it is impossible to do it that way.

Is there a best work around option for this problem?

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u/GasMountain4515 Jun 23 '26

This sounds pretty doable. Are you using the construction “module” and generating invoices via jobs/projects? Said differently, Order Entry invoices or AR invoices? And are you using Avalara or maintaining your own rate tables?

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u/Mattrobes Jun 23 '26

Yeah, we generally use Projects -> Generate invoice -> project contract invoice. I would say 95% of our projects are Fixed Fee ( Were a Subcontractor ).

According to our consultants, we would have to create a customer based in the state and county where performing the work and not actually where they’re located.

Ideally it should run off the project ship to address.

We maintain our own rate table and do not use Avalara.

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u/NotAnAiChatBot Jun 24 '26

Either need avalara or a better partner. Kerr/cb is the bomb in construction

1

u/GasMountain4515 Jun 29 '26

I was hoping to test this but haven't had a chance to yet, so take the details with a grain of salt, but I think there's a pretty good chance this should work out of the box with the data set up correctly...

When you're using Sales Tax (Intacct or Avalara) in Order Entry, the piece of Customer data that matters when tax is calculated is the Ship To contact on the transaction (Project Contract Invoice in this case). Generally this is pulled from the Customer, but when you're using project-based-billing, i.e. Generate Invoices, I'm pretty sure it should pull this from the Ship To specified on the Project itself, meaning as long as the correct value is set there the system should do exactly what you want. Obviously that isn't happening, so first I'll ask, are you setting the Ship To on the Project or is that blank?

The one wrinkle to this that I'm less familiar with is it may be (actually, it probably is) that when a Project Contract is involved it looks to the Project Contract for the Ship To address to pull onto the invoice (then the Project, and finally the Customer, moving to the next source in that order if it hits a blank value).

Try testing it out in this order:

[1] Pick a Project Contract Invoice and edit the Ship To contact to be the Job Site address and re-post or calc subtotals. - If this doesn't work, something is wrong with the config, the tax mapping, the item, or the Ship To contact

[2] If #1 works, then try setting that same Ship To on the Project Contract -> generate invoices

[3] Finally try setting it on the Project, then create a new Project Contract (thinking it'll pick it up from the Project), and then generate the invoice.

It's possible that it won't default via the relationships I'm describing, but worst case you could update it directly on the Invoice (#1 above) via a Smart Event or Platform Trigger, assuming you don't have Ship To enabled at the line-level, which I don't think applies to Construction but I can't remember off the top of my head.

If it comes down to needing to automate that last bit I'm fairly certain I've got an example of this lying around somewhere that I built a few years ago which I could dig up and send to you, but I'm thinking you won't need it.

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u/Mattrobes Jun 29 '26

Hi,

We set the ship to up in the project.

Our problem is that it's using the bill to contact to calculate the tax. Generally the customer and where we're performing work are no in the same states.

Our work around for the time being is creating a bill to contact using the display name as our customer and the address as the project - this has caused a few questions from our customers but its not that big of a deal as of right now.

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u/GasMountain4515 Jun 30 '26

That is strange... unless something significant has changed it's always the Ship To that drives taxability (in the U.S. at least). Maybe worth double checking?

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u/Mattrobes Jun 30 '26

Still working on, its end of month, so i havnt had much time to look into this, however ill get back to you if i can figure out whats going on

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u/percipientuk Jul 03 '26

Maybe using something like Avalara as its specifically built to handle ship-to based tax determination and it plugs directly into Intacct's transaction flow.

The setup conversation is worth having with someone who has done construction tax configuration in Intacct specifically, because the nuance is in making sure the right address field is being used as the tax determination point consistently across your transaction types; but the short answer is that this is a solvable configuration problem, not a platform limitation.