If you are experiencing this error below while creating a document

It means the tax authority isn’t configured in SAP.

In SAP by design, there must be a tax authority for each state where the company is registered and it is configured in AvaTax. Tax authorities are inside the “tax management” work center, click on “tax authorities”, and click on new. Add the information requested below 

* "Tax Authority name" is the name of the state where the business is

Click save, then click on “View all”.  

Finally, complete the “Company Tax Arrangements” tab.

Select the company whose configuration you are doing, then in the “tax number” tab, select option 4 “State sales and use tax RN”; add the Tax number of the company for the state that is being configured.

Finally, try to recalculate the tax amount within the document, and the error 507 should have disappeared.