How to Figure Out Sales Tax on an Item

Make sure you know the tax rate in your area.

Sales tax can be calculated for an item using a basic formula. You need to know the sales tax rate in your particular area to arrive at the correct amount. A sales tax rate can be the same for the entire state, or it can vary by city and county. It is the responsibility of the merchant to make sure sales taxes are collected and remitted. When a purchase is made, the receipt will identify the item(s) purchased, the sales tax rate and the amount of sales tax applied.

Step 1

Locate the sales tax rate for your particular area. You can find the sales tax rate for your state by going to the Retirement Living website. The sales tax rate for your county or city can be located by going to your state's website. Enter "sales tax rate by city or county" in the search field. Tax rates for your county or city will usually be listed in alphabetical order.

Step 2

Find out the price of the item you want to purchase. Once you have the price, multiply it times the tax rate. If the item you are purchasing costs $59.95, and assuming a tax rate of 6 percent, you would multiply $59.95 times .06 to get the sales tax amount of $3.597 (rounded, $3.60). If you are using a calculator, enter $59.95 and hit the times key (X) and then hit the "6" key and then hit the percent key (%).

Step 3

Add the sales tax amount to the purchase. The total amount that should be remitted to the merchant is $63.55 ($59.95 + $3.60). This calculation is usually done automatically by the merchant's cash register. If you have purchased more than one item, the sales tax rate is multiplied by the subtotal for all of your items purchased.

Tip

Some state websites will give a listing of sales tax rates for each county based on the ZIP code.

According to Retirement Living, Alaska, Delaware, Montana, New Hampshire and Oregon do not collect sales taxes.

A single tax rate exists for the following states: Connecticut, Hawaii, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, Mississippi, New Jersey, Rhode Island, Vermont, Virginia and West Virginia.

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