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How to record income tax returns refund in quick books?

Need help to record this refund from income tax department.

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Best answer 10-15-2018

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IF, if the company is taxed as a corporation it would be...

IF, if the company is taxed as a corporation it would be a deposit, and you would use the taxes paid expense account as the source (from) account on the deposit

If the company is a sole proprietor or partnership for income tax, that refund is your personal money.  If you choose to put it into the business, then the source account for the deposit would owner/partner equity investment


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Established Community Backer ***

IF, if the company is taxed as a corporation it would be...

IF, if the company is taxed as a corporation it would be a deposit, and you would use the taxes paid expense account as the source (from) account on the deposit

If the company is a sole proprietor or partnership for income tax, that refund is your personal money.  If you choose to put it into the business, then the source account for the deposit would owner/partner equity investment


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Anonymous
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Re: IF, if the company is taxed as a corporation it would be...

Do you record income tax paid after filing in Quickbooks? I’m a sole proprietor and I made a quarterly estimated tax payment too. Do I record the estimated tax too? Thanks

Moderator

Re: IF, if the company is taxed as a corporation it would be...

Hi there, emak70.

 

Allow me to step in and provide information about recording a tax payment. 

 

Yes, you'll need to record income tax payments after filing in QuickBooks Online (QBO). The system allows you to record a tax payment.

 

To do so, please follow these steps:

  1. Go to Taxes and choose Payroll Tax.
  2. Click on Pay Taxes.
  3. On the Pay Taxes page, click on Record payment for the tax you want to pay.
  4. For the Payment Date, select Other and enter the actual date the payment was made.
  5. Enter the check number.
  6. Click on Record

For further guidance, you can check out this article: Record a tax payment you made outside QuickBooks Online Payroll.

 

On the other hand, the version that calculates the federal estimated tax is QuickBooks Self-Employed. For more in-depth information on this, you can refer to these articles:

This should point you in the right direction. Please let me know if you have further questions. I'm always around to help.

Anonymous
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Re: IF, if the company is taxed as a corporation it would be...

Thanks JaneD. I was actually referring to income tax and not payroll tax. Do you record a sole proprietor’s income tax paid or it’s a personal expense and should not be recorded as a business expense?

Moderator

Re: IF, if the company is taxed as a corporation it would be...

Hello there, @Anonymous.

 

I appreciate you providing me with that clarification. Allow me to help share some information about recording income tax paid in QuickBooks.

 

Yes, you need to record your income tax payments in QuickBooks. For your second question, it depends on how you want to account the payment.

 

As mentioned by Rustler, if you choose to put it into the business, then the source account for the deposit would be owner/partner equity investment. But if not, you can enter it as a personal expense. For more information on how to account the tax payments in your tax reporting, I’d recommend consulting an accountant to make sure it's recorded correctly.

 

If you're using QuickBooks Online Self-Employed, it tracks your tax payments automatically if you pay it online. If you're using QBO, you need to record it manually. The following article contains the step-by-step process: Write checks

 

That should get you back in track. I'm just a post away if you should have any other questions about income tax payments. Have a great rest of your week.

Anonymous
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Re: IF, if the company is taxed as a corporation it would be...

Thank you MaryGraceS

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