1. An inventory item is set to base on customers in the Item Maintenance window. This is the base level.
2. If the item needs to be nontaxable for some states, then you can add it to an Item Category and setup that category as nontaxable for those states.
3. If the item category has more than one item assigned to it and one of those items needs to be handled differently than the rest for a certain state, then that one item can have its category assignment overridden for that state. In that state, the item will belong to a different category (Allowing the item to be handled as needed).

Here is an example scenario. Not based on actual facts!

1. The inventory item, FROG, is set to Base on customers.
2. In some states, FROG, like other amphibians, is nontaxable. FROG is assigned to the AMPHIBIANS item category, so that it can be nontaxable in states where amphibians are nontaxable.
3. In a few states, FROG is considered to be fish bait. Fish bait can be taxable in states where amphibians are nontaxable. For the states where FROG must be taxed as fish bait, an item category override is used to change FROG's item category from AMPHIBIANS to FISHBAIT.

DZ Item Category Maintenance window
DZ Item Supplement window
DZ Item Category Override
Tax By Item Category
DZ Tax By Item Category Setup window
DZ Item Category Assignment window
Frequently Asked Questions