# Price reduction discounts

Source: https://developer.avalara.com/avatax-for-ap/ssx5723770854894/

# Price reduction discounts

Learn how to apply price reduction discounts before sending a tax calculation request to AvaTax.

With price reduction discounts, the discount occurs before sending the request to AvaTax for a tax calculation. For example, if an item has a cost of $100, and you want to apply a $10 discount, simply enter $90 for the amount of the item instead of $100. This is the simplest method for handling a discount because it doesn't involve any additional fields or lines in the request. Notice with this method, though, there is no way to determine that you applied a discount. You only know the discounted sale price of the transaction. In this case, consider adding a reference (`ref1`) to the line item of the transaction to indicate that it includes a discount.

**Example**

```
{
  "type": "SalesInvoice",
  "code": "PriceReductionDiscounts",
  "companyCode": "DEFAULT",
  "date": "2024-07-15",
  "customerCode": "TESTCUSTOMER",
  "addresses": {
    "singleLocation": {
      "line1": "100 Ravine Lane NE",
      "city": "Bainbridge Island",
      "region": "WA",
      "country": "US",
      "postalCode": "98110"
    }
  },
  "lines": [
    {
      "number": "1",
      "amount": 90,
      "quantity": 1,
      "taxCode": "P0000000"
      "ref1": "Applying a $10 discount"
   }
  ]
}
```