When you select “Flat Tax States in Taxable States List” the following list boxes will be displayed allowing you to choose states to charge tax in:
Flat Tax States in Taxable States List allows you to charge a flat tax rate for all states listed in the “Taxable State” list. Only customers with a shipping address in the taxable state list will be charged tax. This option requires that you select one or more states in the taxable state list and enter a tax rate.