Whether an account is a business account or subject to city taxes can affect taxation.
To add or change basic tax information for an account:
On the account page, select Actions, Financial Setup, and then Tax Setup.
The Tax Setup section of the Financial Setup dialog box appears.
If the account is a business account, select This is a business account.
If the account address is inside the incorporated area of a city, select Inside incorporated area of a city.
(Optional) Enter any notes that are required for the account's taxation setup. Select a Reason when entering notes.
Click Apply, or continue with adding exemptions.