Sales Tax invoice requirements in the United States

A Sales Tax invoice in the United States must show your EIN, the customer's details, an itemised list of what you supplied, and the Sales Tax shown separately with its rate — and the rate depends on where you are selling.

What goes on the document

On top of the universal fields — invoice number, dates, both parties, line items and total — the United States expects:

• Your EIN (formatted like 12-3456789)
• The Sales Tax rate applied to each line
• The Sales Tax amount, shown separately from the net
• The total payable including Sales Tax

The the United States rule that catches people out

There is no national sales tax. The rate depends on the state, the county and often the city you are selling into, and most professional services are not taxed at all — a plumber in one state may charge tax on parts but not labour, while a designer two states over charges nothing. Nexus rules decide whether you owe tax in a state you do not live in.

Rates

There is no single national rate — see above. Because there is no single national rate, EstimateBill leaves the rate blank for the US rather than inventing one. Enter what your state requires.

Rates change. Checked to mid-2026 and a starting point, not tax advice. The current source is your state revenue department — and if you are near a registration threshold, twenty minutes with an accountant beats a search engine.

When you have to register for Sales Tax in the United States

There is no federal threshold because there is no federal sales tax. Each state sets its own economic-nexus threshold for remote sellers — commonly $100,000 in sales or a transaction count — and once you cross it in a state you owe tax there whether or not you have ever set foot in it.

Most systems test this on a rolling twelve months rather than your financial year — which is where the expensive mistakes happen.

Which Sales Tax rate applies to what

Rates are built up in layers: a state rate, often a county rate, sometimes a city or special-district rate on top. The same street can have a different combined rate than the next town over. Many states exempt groceries and prescription drugs, and most exempt professional services entirely.

Services are usually not taxable — usually

The default in most states is that tangible goods are taxable and services are not. But the exceptions are broad and growing: several states tax specified services outright, and many tax a service when it is bundled with a good. A repair that includes a part can be partly taxable in a way the same labour alone would not be.

Why this app leaves the rate blank

Every other country in this series has a defensible default rate. The United States does not, and putting one in would be wrong nearly everywhere it was used. So the US profile ships with no rate and asks you to enter the combined rate for the address you are selling into. Your state revenue department publishes a lookup by ZIP code; that is the number to use, not a national average.

Resale and exemption certificates

If your customer is buying to resell, they give you an exemption certificate and you do not charge tax. You must keep that certificate — in an audit, an untaxed sale without a certificate on file is treated as a taxable sale you failed to collect on, and the assessment lands on you rather than the customer.

Tax on a discounted invoice

One that gets miscalculated constantly: when you show a discount on the invoice, Sales Tax is charged on the discounted amount, not the list price. Bill $4,100, discount 5%, and the taxable value is $3,895 — not $4,100. Getting this backwards means you collect more tax than you owe and hand it over, out of your own margin — on every invoice you issue until someone notices.

Invoicing a customer outside the United States

Selling to a customer in another country is generally not a sales-tax event, but selling to another state may be, depending on nexus. The interstate question is the one that matters for most small US businesses.

Charging tax to a client in another country sets out the general shape; the first time it comes up it is worth an hour with an accountant.

Record keeping in the United States

Varies by state, commonly three to four years, with several requiring longer. Keep seven and you are covered nearly everywhere. Retention rules mean the document, not a row in a ledger.

Set your country once in EstimateBill and the tax is labelled correctly on every invoice after that — GST and GSTIN in India, VAT in the UK, Sales Tax and EIN in the US, across 58 countries.