A local software company has won the 2010 Microsoft Partner of the Year award.

Avalara, Inc., which was founded in 2004 by islanders Rory Rawlings, Jared Vogt and Scott McFarlane, provides an online database that calculates sales tax information for businesses that deal with multiple states or taxing jurisdictions.

Avalara was chosen out of an international field of nearly 3,000 top Microsoft partners because “Avalara has consistently delivered market-leading customer solutions built on Microsoft technology,” according to the award announcement.

“We’re still not a huge company among all the ones considered,” said Avalara’s Vice President of Marketing Bryan Wiggins. “It’s a great thing for us to be chosen.”

Avalara’s company headquarters are located at the corner of Ericksen Avenue and Wyatt Way. Avalara has 195 employees, 86 of whom work in the Bainbridge office; 40 are island residents.

The company has opened offices throughout the country and internationally, including Irvine, Calif., San Diego, Batavia, Ill., Detroit, Falls Church, Va.; Atlanta and Pune, India.

In its six years of operation, Wiggins said, the company has expanded from 15 to 20 customers, most of which were island businesses, to more than 25,000 customers worldwide. Wiggins attributed the company’s rise to its ability to keep the process simple.

“We’ve become much bigger,” he said. “It’s fueled by the ability to integrate our program into software systems that businesses use. Every year we’ve rolled out new integrations.”

Despite its expansion, the program remains affordable for the average business, Wiggins said. Prices for the service depends on the number of transactions. An individual transaction only costs a couple pennies, and the more businesses use the program the less each transaction costs.

“The primary object of our service is to make enterprise level technology available to even the smallest companies,” Wiggins said.

The cheapest plan is $100 per year for a couple hundred transactions. Wiggins said clients vary from this level all the way up to millions annually.

The program is primarily designed for businesses that deal in multiple states or counties. The United States features more than 15,000 jurisdictions and keeping up with all the numbers, especially for a small business, can be, well, taxing. Doing the work manually would require awareness of any county, state or city taxes which become attached to an item depending on the buyer’s address.

Avalara’s software saves businesses a lot of time, Wiggins said.

“It’s a cumbersome process that’s difficult for businesses to stay up on, so they look to providers like us to handle it,” Wiggins said.

Avalara is a Certified Service Provider member of the Streamlined Sales and Use Tax Agreement, a national venture to simplify the process of collecting tax in multiple jurisdictions.

Avalara has grown annually since its creation and the company has ,more growth plans, which could lead to more employees for its Bainbridge office. The current space is pretty crammed, and the company is looking for a new headquarters building on Bainbridge.

“Our headquarters are going to remain here as will most of our people,” Wiggins said.