Is there a way to get the profit and loss (or profit and loss comparison) report to show net income BEFORE tax, rather than including income tax expense in the expenses?

Hello Troy,

Welcome to the Community! Customizing your reports is a great way to view the precise data that you need. QuickBooks Online comes equipped with tons of customization options to suit your needs, but there are some limitations as well. Let me explain.

There isn't a way to filter a report to show transactions as their pre-tax amount. You can run a Transactions without sales tax report which will show your transactions that have been entered without having a sales tax code associated with them. However, a report or customization to show just the net amount for a set of transactions. 

If you're looking to filter certain transaction types, for example, to only view expenses from a specific suppier or account, that's possible.  Let me show you how.

1. Navigate to the Reports centre from the left menu.
2. Select the Profit and Loss report, or another report that you'd like to customize.
3. Choose the option to Customize in the upper right.
4. Scroll down to the Filter section and click to expand it.
5. Check the boxes for the things you'd like to filter by, and use the corresponding dropdowns to further specify the details of the customization.
6. Hit Run report when you're ready to view the data the report has pulled.

Since you don't want to view income tax-related expenses, you may try filtering by supplier and exclude the supplier that you pay income tax to, or by account and exclude the account or category that you select when entering income tax expenses. 

If this isn't quite what you're looking for, I want to encourage you to submit feedback on this to our team of product developers. You can do this by navigating to the Gear icon, then selecting Feedback. Having your voice heard is important to us - we want to ensure that we're bringing out new features tailored to meet the needs of our users. 

Have a great day and don't hesitate to reply to this thread with other questions you may have. 

Thanks for your response.

What I am looking for is a standard income statement, like in QB Desktop and any other accounting software, as follows:

Ordinary income/expense

Income

Revenue

Sales

Etc.

Total income

Expense

Bank charges

Salaries

Utilities

Rent

Etc.

Total expense

Net ordinary income

Other income/expense

Other expense

Income tax expense

Total other expense

Net other income

Net income

The above is how this was laid out on the P&L in QB Desktop for this same client.

I don't understand why QBO treats income tax expense as a regular expense, rather than showing it separately at the bottom.

I see what you mean @troy-greer. There isn't a way to reorder or reorganize the way the accounts are sorted in the Profit and Loss report. You do have the option to Export the report to Excel so that you can manipulate the data manually, in order to see exactly what you need. Here's how: Export reports, lists, and other data from QuickBooks Online. Submitting feedback as I recommended in my previous reply is the best way to have your say on this. I'll pass the message along on my end as well. 

I did it like this which puts Federal and State Income tax below NET OPERATING INCOME which would be your Pretax Income Sub Total before the following Federal and State Taxes are deducted:

Accounting > Chart of Accounts > Federal Income Tax (or however you named your federal income tax expense)  > Edit  

Account type: Other Expense
Detail type: Other Miscellaneous Expense
Name: Federal Income Tax
Not checked box: Is a sub-account

Accounting > Chart of Accounts > State Income Tax (or however you named your state income tax expense)  > Edit  

Account type: Other Expense
Detail type: Other Miscellaneous Expense
Name: State Income Tax
Not checked box: Is a sub-account

This also provides QBO format Income Statement to sort and sub-total like a customary GAAP presentation and an IRS Form 1120.

Where does tax expense go on the income statement?

one example attached and another below

accounting tools dot com