# Core concepts

Source: https://developer.avalara.com/tax-transparency/nul8821266807751/

# Core concepts

Learn about key features, including tax explanations and forward-thinking insights, to understand and manage tax compliance effectively.

## Explain the tax

After tax is calculated on a transaction, users can select **Explain the tax** to view a comprehensive breakdown of how tax was determined.

Explanations may include:

-   Jurisdiction-by-jurisdiction rate breakdown

-   Sourcing methodology applied

-   Exemption status and certificate usage

-   Special rules or adjustments that affected the calculation

The AI agent translates calculation data into plain language to support clarity and review.

## Proactive insights

The AI agent surfaces relevant tax insights automatically before and after calculations.

Examples include:

-   Upcoming exemption certificate expirations

-   Special tax scenarios such as caps or reduced rates

-   Jurisdiction-specific considerations

These insights help users identify compliance risks and act when needed.