Step 1: Create a Collection for Your Exempt Products
Collections let you group the products you want to make exempt. Shopify applies tax overrides at the collection level, so this step is needed even if you only have one exempt product.
Go to Products > Collections in your Shopify admin.
Click Add collection in the top right of the Collections page.
Enter a Title for the collection (e.g. "Tax Exempt — Food").
Under Collection type, choose Manual to add products yourself, or Smart to add products automatically based on conditions you set.
Add the products that should be made exempt.
Click Save.
Step 2: Open Your US Tax Setting
In Shopify, go to Settings > Taxes and duties.
Click United States in the Tax regions list.
Step 3: Add a Product Override
Scroll down to the Product overrides section.
Click Add override.
Step 4: Apply the 0% Tax Rate
Select the Collection you created in Step 1.
Choose the State where the products should be exempt.
Enter 0 in the Tax rate field.
Click Add override.
If your products are exempt in more than one state, repeat Step 4 once per state.
You're Done
Your selected products will now be charged 0% sales tax in the states you've configured. Shopify applies the override at checkout automatically.
A note on tax exemptions: Exemption rules vary by state and product category. If you're unsure whether a product qualifies for exemption in a specific state, check with your Yonda CSM before applying overrides.