Aseptico tackles sales tax with Streamlined Sales Tax (SST)
Manufacturer attains compliance, scales to 40 states with Avalara and SST
"If SST wasn’t a thing, I’d be paying Avalara for those transactions and returns. It’s astounding how many companies don’t understand those benefits."
– Paul Jackson
- Identifying and planning for expanding nexus obligations
- Mitigating audit risk and achieving compliance
- Increasing complexity and cost of managing sales tax in 40 states
- Avalara AvaTax
- Avalara Returns
- Avalara CertCapture
- Avalara Certified Service Provider for the Streamlined Sales Tax Program
- Established nexus footprint and determined strategy for expanding obligations
- Addressed previous tax liability and reduced audit risk
- Used the SST program to address complexity, minimize costs, and increase accuracy
Founded in 1975, Aseptico manufactures and distributes high-quality dental equipment such as implant, endodontic, and portable dental systems to customers in 40 states and more than 125 countries.
In 2016, CFO Paul Jackson implemented the Avalara tax compliance suite with Epicor for ERP and WooCommerce as an ecommerce integration at Aseptico. Already registered for, collecting, and remitting sales tax in five states, the company suspected it had additional obligations due to their broad sales footprint and growing sales channels.
“Our owner wanted to be compliant, but the volume and complexity were more than we could handle at our size,” says Paul. “It was cheaper to automate, because we didn’t have the resources to handle it all.”
Once the integration was complete, Aseptico needed to understand where it had additional sales tax nexus obligations. Nexus is the connection between a seller and a state, requiring the seller to register for, collect, and remit sales tax. Aseptico underwent a nexus study and developed a plan to become compliant. The study indicated that Aseptico wasn’t collecting and remitting in some states where it should. The company engaged Avalara for Voluntary Disclosure Agreements (VDAs) with the states where a past obligation existed. The VDA process enabled Aseptico to manage past tax liabilities.
While working through the VDAs and nexus study, Paul discovered the Streamlined Sales Tax (SST) program and the associated benefits.
Optimizing through Streamlined Sales Tax
SST is a cooperative effort among state and local governments to streamline sales tax collection and administration. There are 25* states in the program, which requires states to simplify and centralize aspects of sales tax administration.
The SST program is more beneficial for some businesses. Participation in SST is voluntary for both businesses and states, and businesses that qualify for Volunteer status can realize significant benefits. Volunteer status is based on the related sales tax nexus profile and other factors. For example, most SST states allow sellers to qualify for Volunteer status if they’ve established economic nexus.
For those who qualify, working with a Certified Services Provider (CSP)—such as Avalara — streamlines the sales tax process, minimizes costs, and supports compliance. CSPs provide free sales tax calculations, preparation, and filing in participating states where businesses qualify as a Volunteer. Paul realized SST made sense for Aseptico. “Some states we needed to add were SST member states,” Paul explains, “so it made sense to participate since we qualified for Volunteer status in those states.”
As the VDA process wrapped up, Paul prepared to register in the other non-SST states and the SST member states. In June 2018, the Supreme Court ruled in South Dakota v. Wayfair, Inc., a decision enabling states to enforce nexus obligations based on economic activity. The ruling supported Paul’s decision to register in all SST states. “The SST program was appealing because I wouldn’t have to watch a bunch of states, worrying whether I crossed an economic threshold or not. It allowed me to get registered and not think about it again.” Aseptico was ready to go.
“By the time Wayfair hit, all we had to do was pull the trigger,” says Paul. “I emailed my Avalara account manager, and the SST team reached out. They asked a few questions, got me registered, set up filing calendars, and started doing returns. Because we were so prepared, the whole thing took less than a month.”
Reaping the Benefits
SST enabled Aseptico to register in the SST states with a single form and at no cost with Avalara. For SST states where the company qualifies for Volunteer status, Avalara registers, calculates, and remits on the customer’s behalf at no cost. Aseptico pays nothing for its sales tax services in more than half the states where it’s registered. “If SST wasn’t a thing, I’d be paying Avalara for those transactions and returns,” Paul adds. “It’s astounding how many companies don’t understand those benefits.”
Avalara will work with state auditors on Aseptico’s behalf if they’re ever audited in states where they’re an SST Volunteer seller. In all registered states, AvaTax provides nexus alerts to help monitor economic nexus thresholds.
Besides fulfilling his boss’s desire to be compliant, implementing the Avalara tax compliance suite significantly reduced the company’s audit risk across 40 states.
“We were audited by the State of Florida for a period that straddled our go-live date with Avalara,” he explains, “and the findings on either side of the implementation were substantially different. We were very clean, post-Avalara, while the period before had lots of problems—paying the wrong amounts, applying the wrong rates, getting item taxability wrong.”
The company is now confident that it’s calculating sales tax correctly, filing on time, and remitting the appropriate amounts. “I will never again in my life have to file a sales tax return, because Avalara will always do that for me.”
*There are 24 member states in the Streamline Sales Tax program and one additional state that runs independently through a similar state-run program.
Avalara Tax Compliance Suite
A complete, end-to-end sales and use tax compliance solution - built to grow with your business.
Avalara AvaTax determines and calculates sales & use taxes.
Avalara Returns handles monthly sales & use tax filing, payments, and notice management.
Avalara CertCapture helps businesses collect, store, track and utilize exemption certificates.