How do we configure sales tax in Magento CE for multi-store / multi-stite

We have a multi-store/multi-website configuration of Magento. Not all of the stores are in the same state or locality. The Tax Rules, tax zones & rates, and tax classes seem to be applied across all stores. In the System->Configuration, there is a place to check whether taxes are based on origins or destination, etc on a store by store basis.

Do we just put in tax rates for all states, and then just configure each store to base taxes on origin? Will that magically just charge tax on sales to people who are located in the store's shipping origin?

The more I read on this subject, the more confused I become. I'm new to Magento and certainly not a tax expert.

THANKS!