Forma recommends that all items under a given account have the same tax treatment. This is to eliminate the risk of associating the wrong tax type to a transaction.
When an employee purchases an item from a big-box retailer such as Amazon or Walmart, Forma can ensure that eligible transactions are approved, but it is difficult to distinguish eligible items in terms of tax treatment.
For example, imagine you create an account that allows employees to buy books (taxable) and home office equipment (non-taxable). If a book and a piece of home office equipment are purchased in the same transaction, Forma can’t easily differentiate the taxability of each item because the purchase amount is stored as one line item in the card issuing system.
Best practice is to set up dedicated tax-free accounts and dedicated taxable accounts separately to avoid such errors.