Sourcing override enhancements Avalara is updating how custom sourcing overrides are applied to certain transactions that contain local jurisdictions. Standard sourcing rules are not impacted by this change.
This update helps ensure that the tax engine applies the correct origin or destination sourcing when a tax rule specifies an override. It also resolves prior cases where the default sourcing was applied instead of the rule-specific sourcing.
- Custom Tax Rule enhancements for Sourcing Override:
U.S. and Global Rules for local jurisdictions now support sourcing overrides for all Tax Types other than VAT (Input and Output).
The engine will recognize Origin/Destination sourcing overrides defined in custom product taxability rules for local rules (county/city/STJ). Previously, sourcing overrides were recognized only for State-level rules, applied to the State and all local jurisdictions. With this change, local jurisdictions can be taxed based on the sourcing specified in the local custom rule, which may change which local jurisdictions apply during calculation.
- Minor enhancements / fixes:
When Avalara content overrode default Sales & Use sourcing AND a custom rule with a blank sourcing override was applied, the system sourcing override was not applied, and the engine fell back to default sourcing. This has been corrected.
This corrects a reported problem where Illinois Rental/Leasing tax type was suppressed for Chicago (destination-based) when an IL Sales & Use custom rule with no Sourcing override was applied, In this case, the engine fell back to default Origin-based sourcing for IL.
The line-level Sourcing indicator (Origin/Destination) was incorrectly reporting “Origin” for Illinois Chicago Rental/Leasing calculations. Now, the Sourcing indicator will correctly reflect “Destination” (tax calculation is not changing—this is a reporting correction only).