# Understanding discounts and overrides

Source: https://developer.avalara.com/avatax-dm-combined-erp/sales-tax-badge/transactions/discounts-and-overrides/

# Understanding discounts and overrides

Before continuing with this section, it's helpful to understand the difference between discounts and overrides.

-   A discount is a reduction of the price on your item/service. There are several ways you can handle a discount with the AvaTax engine, including price reductions, negative line amounts, automatically distributed discounts, and manufacturer discount codes.
-   An override is used when your transaction overrides normal behavior of the AvaTax engine. Overrides can be used to change the tax amount or tax date for a transaction.

We will describe both discounts and overrides in greater detail in the next sections.

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