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Tracking TPT Taxes to be paid later

I used the instructions at the bottom of this message to figure out how to track TPT taxes we owe monthly (not included on invoices we receive, since we pay it). It's exactly what I was looking for, however I just entered a  bill using these instructions and I ran into a snag. When I enter the invoice, I enter the total amount of the invoice (which obviously is not including the TPT tax), then I proceed on to the Expense tab to enter the line item from the invoice for the full amount, which matches the total I entered above. However, when I enter a new line item for the TPT Tax to the liability account, it now changes the total of the invoice we owe, which I don't want, because when we go to cut checks weekly, it's saying we owe the invoice amount + the TPT tax for the full invoice. But that's obviously not what we owe the vendor. We owe the vendor their invoice amount and we owe the TPT tax at the end of the month to the state.... any way I can still calculate it this way without messing up the total invoice amount?   Track sales tax on purchases as a liability (to be paid later)

  1. Create an Other Current Liability account.
    1. From the Company menu, click Chart of Accounts.
    2. In the Chart of Accounts window, right click anywhere and click New.
    3. In the Choose Account Type window, click the Other Account Types drop-down then select Other Current Liability.
    4. Click Continue.
    5. Enter the Account Name and other details then click Save & Close.
  2. When creating a transaction (like a bill) in which you will be tracking sales tax, enter the bill as usual, but go to the Expenses tab instead and select the liability account created in step 1.
  3. On this line, enter the amount of sales tax in the Amount column (this will need to be calculated manually).
  4. Ensure that any detail in this transaction adds up to the correct total after clicking Recalculate.
  5. When it is time to pay this sales tax, you can see the liability that has been accrued by looking at the Chart of Accounts.
  6. This amount can be paid with a regular check.
1 Comment
QuickBooks Team

Re: Tracking TPT Taxes to be paid later

Hi there, @topknotchbookkeeping.

 

Thanks for taking the time to reach out to the QuickBooks Community. Allow me to help provide some insights about tracking TPT taxes in QuickBooks Desktop.

 

I'd like to acknowledge your effort in sharing very detailed information about your concern. First things first, let's set up a sales tax so you can track and add the TPT taxes to the invoice transaction for the monthly payment. 

 

You can check this article for the detailed steps on how to Set up sales tax in QuickBooks Desktop.

 

Right after, you'll need to enter the inclusive amount on the invoice line item with the TPT tax, this way it will not affect the total calculation of the invoice total amount.  But before doing this, you'll need to consult an accountant to ensure you have the correct calculation of taxes. 

 

 

Don't hesitate to click the Reply button below if you have any additional questions. I'd be happy to answer them for you. Have a good one. 

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