Why is there a negative balance in the original sales tax payable

Was it a negative number before the daily Sales Tax transactions started going in?  

Or is the negative number just the transactions that went in before you made your first payment.

Pete,

The negative balance equals payments I made to the comptrollers office in quickbooks desktop version. When I moved to QBO, these payments are not showing up. How do I correct?

Hello there, @randylykins.

Thanks for getting back and providing extra details. I can help you create an adjustment to fix your sales tax problem.

1. Click Taxes.
2. Choose Sales tax.
3. Select the tax agency associated with the return.
4. Click the Returns tab.
5. Look for the line item for the sales tax you want to adjust and click Prepare Return.
6. Click the Adjust link.
7. Enter the necessary information.
8. Click Save.

For more insights, please check this link: How to Adjust Sales Tax Liability in QuickBooks Online. That should adjust or zero out the sales tax balance, randylykins.

I'm still here to help you more if you have follow-up questions about sales tax. Just drop a comment or mention my name. Have a wonderful day ahead!

I do not see anything on my screen that reads returns tab.

Sorry, my head was on backwards and did the double negative.  So the payments showed up but your prior Sales Tax Liabilities didn't. 

Did all of your prior sales get imported into QBO correctly?  If you go to one of the invoices or sales receipts that would have been in that period, does it show the Sales Tax and is it going to your Sales Tax Liability account?

I don't know that I'd start adjusting the Sales Tax on Client/Customer accounts if they're actually correct.  It could be an issue if you're ever audited for Sales Tax and they see a lot of No Tax or Incorrect Tax entries.

Maybe a Journal Entry to get the proper ST Liability in before the payments to correct your numbers.  A quick conversation with your Tax Accountant may be in order.

Hello. The QBO file I am working on has activated the new sales tax module, and it does not let me select the tax agency associated with he return to make the adjustment as you have suggested.

There are overpayments for a period because there are credit memos being applied on that same period, reducing taxable sales. 

Hello, @Iausolutions.

I hope your day is going well.

Since your sales tax has been updated, let's go ahead and check the sales tax settings and remove the agency. This way, you'll be able to include the agency on the sales tax rate.

Here's how:

1. In the left-hand menu, select the Taxes tab.
2. Choose Sales Tax, then click on Sales Tax Settings.
3. Under Other, put a checkmark in the Include Inactive option.
4. Go to the Gear icon beside Add Agency.
5. Go back and pick Make Active.

Once you've completed the steps above, I'm sure you'll be able to select the correct tax agency associated with your return.

I've also added this article with more information about the sales tax in QuickBooks Online: Set up and use automated sales tax in QuickBooks Online

Let me know if the information above helps you with adding the agency that's associated with your return. I'm always happy to help!