Sovos and freight

Sovos uses special product codes to identify special taxing needs. Freight may or may not be taxable based on the state. Product code 40000 is used by Sovos to identify freight charges in the system and must be associated to a tax group in Distribution SX.e to handle tax charges properly for each sales order within each jurisdiction.

Assign the code 40000 to tax group 2 in SA Company Setup to correspond with the Sovos product code. Then, in SA Sales Use Tax Setup-State-Addons, in the Freight In and Freight Out fields, select tax group 2.

The other addons should be retained as standard or tax group 1, indicating they are taxable, or changed to tax group 2 if they represent other versions of a freight charge. If new freight-related addons are added to Distribution SX.e in the future, you must update the SA Sales Use Tax Setup state records to assign a tax group of 2 so the addon is taxed as a freight charge.