Adding tax to a price
Total = price × (1 + rate / 100). A $100 purchase at a combined 7.5% is $107.50, of which $7.50 is tax. Each jurisdiction is applied to the same pre-tax base, so the four layers add up rather than compounding on one another.
Quantity is applied before the tax: the unit price is multiplied out first, and the extended price is what gets taxed. Ten laptops at $999 are taxed on $9,990, exactly as a register rings them up. The quantity field is rounded to a whole item and never drops below one, because receipts do not carry half a laptop.
The table breaks the tax out by jurisdiction with the combined rate in the footer, so every layer can be checked against the rate a receipt prints. Nothing is allocated to a layer that was entered as zero.
Removing tax from a total
If the price you have already includes tax, the pre-tax amount is total / (1 + rate / 100). At 7.5%, a $107.50 total holds $7.50 of tax, because $107.50 / 1.075 = $100.
The common mistake is multiplying the total by the rate, which overstates the tax: 7.5% of $107.50 is $8.06, not $7.50. Tax is always a percentage of the pre-tax amount, never of the amount that already contains it.
That is also why the tax inside a total is a smaller share of the bill than the headline rate suggests - just under 7% here. The page prints that share beside the rate so the two cannot be confused, and the note under the answer states the two directions return the same numbers.
Where the rate comes from
State sales tax exists in all but five states: Alaska, Delaware, Montana, New Hampshire and Oregon have no statewide sales tax, though Alaska allows local rates. On top of the state rate, counties, cities and special districts for transit, schools, stadiums or tourism add their own.
Those extra layers are why the page asks for four rates instead of one. The state field accepts up to 20%, and the county, city and district fields up to 10% each; the combined rate is their sum, and a rate of 9% or more is treated as a warning sign worth double-checking against the receipt.
Some states apply local rates at the state level rather than city by city, and a few tax only specific goods. That is why the rate on a receipt is the authority for a particular purchase, and why an average pulled from a website is only a starting point.
What is exempt, and what the page leaves to you
Most states exempt food bought at a grocery store, prescription medicine and some clothing, often up to a price cap per item. Services are taxed in some states and not in others, which is why two invoices for the same work can differ.
Online purchases depend on the seller having a physical or economic presence in your state. After the economic nexus rules that followed the 2018 South Dakota v. Wayfair decision, most large sellers collect in most states, but the thresholds differ and this page does not decide whether one applies to you.
The second table shows the same purchase at 0%, 4%, 5%, 6%, 7%, 7.25%, 8%, 8.875%, 9% and 10%, which is enough to sanity-check a receipt against nearby rates. Exemptions and nexus are outside the arithmetic; the page prices the rate you enter and nothing more.
Rounding, stacked local rates and use tax
The tax on a basket is not always the tax on each item added up. Most states compute the tax on the invoice total and round once, but some round per item at the register, which is why a receipt for ten $1 items can show a few cents more than 8% of $10.
Combined rates stack rather than compound: a 6% state, a 1% county, a 0.5% city and a 0.5% transit district make 8%, all charged on the same pre-tax base. That is also why a rate quoted for one address is no guide to the next town, since special districts are drawn around transit lines and stadiums rather than around state borders.
Two things this page cannot price are shipping and use tax. Shipping is taxable in some states when it is part of a taxable sale, and use tax is the mirror image of sales tax: buy online from a seller that does not collect, and the tax is still owed and self-reported on the state return. Both are reasons a receipt and a rate check can disagree without either being wrong.
Danfio