When reviewing your filings in Kintsugi, you may occasionally notice a discrepancy between the Total Liability on your dashboard and the Tax Collected on your transaction reports.
This usually occurs because Kintsugi calculates your tax liability based on the destination jurisdiction and your product categories, even if no tax was collected at the point of sale.
By default, Kintsugi ensures you remain compliant by identifying the actual Tax Liability. If your checkout system (like AvaTax or Shopify) fails to collect tax on a taxable transaction, Kintsugi still flags that amount as owed to the state.
Common reasons for these "Nexus Anomalies" include:
Checkout Misconfigurations: A product category may be marked as non-taxable in your storefront, but is legally taxable in the destination state.
Threshold Settings: Tax wasn't collected because a specific state threshold hadn't been met at the time of the order, but the filing now requires it.
Calculation Gaps: Differences in how various tax engines interpret local jurisdictional boundaries.
If you see a filing total that is higher than your collected tax, you can audit the variance manually:
Navigate to the Filings tab.
Select the specific state and click the three-dot icon, then click Download Report.
Open the report and compare the Calculated Tax Amount column against the Total Liability column. This will show you exactly the variance.
Kintsugi provides a setting that lets you override the calculated liability and file based solely on the tax amounts you collected from your customers.
Log in to your Kintsugi App.
Navigate to Configuration.
Click Settings.
Locate the toggle for File Only What You've Collected.
Switch the toggle to Enabled.
When to enable: Use this if your primary goal is to match your filings exactly to your integration's tax collection and you are confident in your checkout's tax engine.
The Risk: Turning this on may result in underpaying the state if your checkout failed to collect tax on a legally taxable item. This could lead to audits or penalties later.
When to keep it off: Keep it disabled (default) if you want Kintsugi to act as a "safety net" to catch uncollected taxes, ensuring you are 100% compliant with state laws.
Note: Once enabled, your future filing totals will align perfectly with your transaction-level collected tax exports.
For further concerns, we're always here to help. Click the chat bubble in the bottom-right corner to speak with our support team.
