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Feature - Minnesota Sales Tax Retail Delivery Fee (RDF) Support

← Customer Order Processing
Release Date: 6/12/24
Version: 8.5 and above 
Avalara Release Date: 6/20/24 (Elliott support) 7/1/24 (Avalara support)
Version: 8.6 and Above

Effective 7/1/24
For Minnesota sales tax, a new Retail Delivery Fee (RDF) has been added effective 7/1/24 for all retail deliveries within the state of $0.50 that MUST be listed on the invoice to the customer as a separate line item. If you are collecting Minnesota sales tax, then it is your responsibility to add this miscellaneous RDF line item to all taxable Minnesota sales orders. This feature will not remind you at the time of order entry to add this line item, but it can put the sales order on hold during pick ticket or invoice printing. Hence, it can prevent an order with this error from shipping out. This feature is not enabled by default in Global Setup. If you wish to enable it, we recommend that you also use the COP -> Processing -> Release Held order feature.

The following explains the steps to configure Elliott to support this feature.

1. Add RDF Product Category
Set up a special product category: say RDF – Retail Delivery Fee, or anything you feel appropriate in Inventory Management-> Maintenance-> Product Category File.



2. Add RDF Miscellaneous Item
Next, add a Misc. item that’s not taxable (so we don’t calculate tax on tax). It should be a non-stock item with $0 unit cost. The unit price is $0.50. The cost should be $0.50 as well since you are collecting this fee on behalf of Minnesota. The product category is RDF.



3. Add Product Category/Location to Update Proper Sales Tax Liability Account
You need to go to COP -> Maintenance -> Product Category/Location Account File Maintenance, add the records for RDF product categories and all possible locations that you may sell from. The Sales Account will be your sales tax liability account. You may consider a separate cost of goods sold (COGS) account so this is not part of your regular inventory COGS.



4. Global Setup to Turn on RDF Feature
The RDF feature does not turn on by default. To turn on this feature, you need to go to Global Setup-> COP-Ctl-> Credit Check & Release-> 21. Check For MN Sales Tax Retail Delivery Fee?



21. Check For MN Sales Tax Retail Delivery Fee? - Default is N. If set to Y, a popup window will prompt the user for the Minnesota RDF Item Number and the Minnesota RDF Threshold. Set the field to N to disable the support for the new Minnesota retail delivery fee checking.



Minnesota RDF Item Number - This field must be entered. Spaces are not allowed. Enter the miscellaneous item set up to support this fee.
Minnesota RDF Threshold - Enter the minimum order total amount required before the retail delivery fees should be applied to the order. As of 7/1/2024 this is $100.00.

During order entry, it is your responsibility to make sure to add this misc. RDF item to all taxable Minnesota orders over the threshold amount. If the item is added to the order and the order total amount is less than the threshold amount, a warning message will print on the picking ticket.

5. Release Held Order
This feature will detect if the miscellaneous RDF item is missing from the order at the time the picking ticket is printed or when the invoice is printed. If the miscellaneous RDF item is missing from the order, the order will be placed on hold. Also, if the order total sale amount is under the threshold defined in Global Setup and the order has the Minnesota RDF item as one of the line items on the order, the order will also be placed on hold. A note will be attached to the order that explains the reason why it is on hold. We expect you to use COP -> Processing -> Release Held Order if you have this feature enabled.

Below is a sample credit hold note for missing the Minnesota RDF Item:



  Below is a sample credit hold note for an order that is under the threshold and has a Minnesota RDF Item on the order:


  

6. Get Email Notification for Credit Hold Event
In addition, the PICHLDCU (Pick Ticket Held For Customer) and PICHLDSM (Pick Ticket Held For Salesman) events will allow you to subscribe by customer or salesman to the email when the order is placed on hold. See sample screen below:



If you only wish to receive the email when the order is put on hold due to sales tax reasons, you may specify the "held Type" EQ "T." See sample screen below:



7. Note for Avalara Sales Tax Interface
If you use Avalara Sales Tax Interface (supported after Elliott 8.6,) you should be aware of the following:
  1. You should continue to add RDF items to taxable Minnesota orders.
  2. The RDF fee, as of this writing, is hard coded to be sent to Avalara as tax code OF400000 with $0.00 amount.
  3. Avalara will be able to determine the RDF amount and return back as part of the sales tax amount. If the order total sale amount is less than the order threshold, Avalara will return an amount of 0.00 for this tax.
  4. Elliott will deduct RDF from the Avalara returned sales tax amount.
  5. Therefore, there will be a discrepancy between the sales amount and the tax amount from Elliott and Avalara when Minnesota RDF is involved. However, the total of the order amount will still match.
  6. The root of this issue is with Minnesota regulations that require the RDF be shown as a separate line item with the amount instead of the tax amount on the invoice footer.
8. Note on General Ledger vs Sales Analysis by Customers
Your General Ledger will reflect correctly this $0.50 as tax liability if you set up the Product Category/Location Account file correctly. On the other hand, if you perform sales analysis by customer, this $0.50 will unfortunately show up as sales due to Minnesota regulations. 

Programs Modified: NSCTLFIL.FD, NSCTLFIL.W40, NSCTLINI, NSCTLMN4, GETHLDMSG.WS, GETHLDMSG.PL, CPINVPRT, CPINVPRH, CPINVPRP, CPINVPRT.PL, CPINVPRT.WS, CP02P1, CP02P1.PL, CPPICPRT, CPPICPRT.PL, CPPICPRT.WS, ELAVATAXCS.cs, NSCTLFIL_40.cs
CLS

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