Issues with sales tax not migrating correctly from website's platform to QBO

Thank you for sharing your concern here in the Community, @sanman1.  

I understand the challenges you've experienced when migrating sales tax from the website platform to QBO. Let me help you fix it.

QuickBooks Online has a default sales tax rate based on the location, which cannot be changed. However, you can set up a custom rate as an alternative to ensure that the state's correct sales tax rate is reflected on each receipt..

Here are the steps to set up a custom rate:

1. Open the Taxes menu.
2. Click on Sales tax settings.
3. From the Custom rates section, choose Add rate.
4. Click on Single or Combined.

Once done setting up your custom rate you can manually select the tax rates from the Based on location dropdown on the sales receipt you've created. 

Please note that you can only use one custom rate on a transaction. If you need to charge multiple tax rates, you have to set up a combined rate first.

I'm also adding this link as your guide which contains detailed and complete information about custom rates in QuickBooks Online: Use custom rates to manually calculate taxes on invoices or receipts in QuickBooks Online

In addition, feel free to visit these useful guides to assist you in keeping track of and managing your reports in QBO:

• Run reports in QuickBooks Online
• Customize reports in QuickBooks Online

If you have further questions about taxes, please let us know. We're available to help you at any time.

Thank you for your response, though it appears that it did not address the core issue. We carefully reviewed all instructions and even watched relevant YouTube videos before we set up the sales tax rate. To put it plainly, we have a straightforward question: Is it possible to migrate a sales receipt from our website's platform into QuickBooks Online (QBO) while ensuring the accurate transfer of the sales tax rate and state authority information? If we are required to manually correct 30-50 receipts every day, it indicates a significant flaw in this process that needs immediate resolution.

Before you instruct us to check the sales tax configuration from the Big Commerce platform, we already did and it states "You have Automatic Taxes turned on in QuickBooks Online. There is no need to configure any tax mappings". 

We kindly request guidance on how to facilitate this uncomplicated transfer using the "Automatic Sales Tax" feature. Furthermore, there's another matter we overlooked in our previous message – the "This customer is not tax exempt" message that appears after migrating the receipt. As an ecommerce retailer catering to individual customers, we primarily deal with customers who are "out-of-state" and "tax-exempt," constituting around 90% of our sales. If there is a solution to address this issue, we would greatly appreciate your input. However, if not, it's evident that the sales tax system is flawed in several aspects and necessitates urgent rectification. Your prompt assistance in resolving these concerns would be highly valued. 

We understand how updates and detailed information are relevant for you and your business, sanman1.

I've seen here that you've posted twice in this forum. You may consider visiting this link to help you acquire relevant insights in rectifying your sales tax concern shared by the original poster of the thread: https://quickbooks.intuit.com/learn-support/en-us/taxes/re-turn-off-based-on-location-sales-tax-feat....

If you have additional queries or other QuickBooks-related concerns, feel free to reply below, and we'll be available anytime you need assistance.  

I am having the same problem where QBO is not migrating correctly. Is there a way to turn off the automatic sales tax "based on location" feature?

Thanks for joining us here on the thread, @DJSPEC. We recognize how important it is to turn off the sales tax based on location. However, deactivating this feature is not currently possible in QuickBooks Online. We recommend sending feedback to our product developer team to encourage them to review your request and potentially incorporate it into future updates. 

Here's how: 

1. Select the Gear icon, then choose Feedback.

2. Type in your comments or product suggestions.

3. Select Next to submit.

On the other hand, we'll leave this article to assist you in editing your sales tax rate in the future: Edit sales tax rate in QuickBooks Online.

 For further concerns regarding your sales tax, let us know by replying to this thread or starting a new one. Stay safe and take care. 

Same issue here on my end.  And its very frustrating. Not to mention time consuming.  I cant understand why Intuit cant figure out how to correct this.  It is defintely a problem, one that NEEDS to be addressed by them for sure.

@jmcustomkydex1212 

Are you using an eCommerce platform (e.g BigCommerce, Shopify)? You can use a 3rd party connector and you can set the connector to calculate the sales tax and override the AST setting in QBO.

Hello, I am using BigCommerce and Avalara for sales tax and having the same issue, the workaround mentioned previously works, I am in VA so I had to set up a custom rate VA tax to match what VA mandates, a split tax totaling 6%.  The big issue I have now is all of my shipped out-of-state invoices, or drop-shipped orders do not show up in my VA tax report at all. This doesn't affect the tax I pay but, does affect the amount of non-taxable sales on my filing. I just discovered this issue yesterday, so I am digging into it currently and do not have any solution other than manually changing from based on location, to the VA tax in the drop-down box and then un-checking the taxable box beside each item. This gets the sale into my VA report as non-taxable. I am trying to get in touch with someone to chat about this and see what the fix would be. I will follow up if I find anything out. I am not an expert and have only been using QBO for a year. I will also investigate if there are settings in my integration software on how to post the orders into QBO. Hope we all can get answers, as this issue makes QB useless for online sellers with automated posting. If anyone finds a solution, please email me or comment back on here please! [email address removed]

Good morning, @RobK1. 

It's great to see you back in the Community! 

I recommend getting in touch with us or with your third parties to review your account and settings that could help. Here's how to get in contact with us: 

1. Go to the Help icon in the top right-hand corner. 
2. Press the Contact Us button. 
3. Give a brief description of the problem and tap Let's talk. 
4. Scroll down and pick to Get a callback. 

It's that easy! 

Big Commerce Support

Avalara AvaTax Support

Keep us updated on how the conversation goes. I'm only a post away if you need me again. Take care! 

Candice, currently the help icon brings up the chat bot which says it is having technical difficulties to click a link for resources. So from what i see, no way to direct contact anyone at this time.

Everything is pulled correctly until it is posts in QB, i have tested posting settings with Webgility and nothing will change it to show in VA report automatically. 

My hunch at this point is that none of us know our states sales tax rules.  Again I am just a guy and not an expert. But in thinking about this. I am in VA and I sell and ship an item to a customer in WV. With auto posting this sale ends up in out of scope agency with no tax liability as the sale was not taxed, and not showing up in my VA report. Maybe it does not need to be in my VA report as it is a WV transaction at this point. When I reach Nexus in WV, QB would not be able to show this transaction in my WV tax report and my VA tax report.(I don't think it is possible) It can only show in one place. I am currently trying to find if this is in fact the case, but it is difficult to find answers in VA. Our sister company has had to change the things they tax and don't tax multiple times over the years as individuals from VA tax department give conflicting information. I hope one of us can figure this out soon. I am going to keep filing like i have been, all out of state sales(shipped) are not included in my VA non-taxable sales. If I reach Nexus in another state, that sale would automatically be put into a tax account for that state from the based on location feature.

Also if you offer in store pick-up to out of state customers, you still need the custom tax for your state and you would change that sales form tax selection to this new custom rate. Pick-up orders need to be taxed in the state in which you have physical nexus. Good luck all having this issue.

I am having the same issue. I notice that this has been going on for over a month now based on the date stamps. If QBO knows about it, why has a resolution not been reached?

I use a 3rd party software that has a formal relationship & integration with QBO. The sales tax has always run smoothly at 8.25% on each invoice. Now when we batch over our invoices, it defaults to "based on location". The "based on location" default only charges 7.25% and there is no apparent way to make an adjustment to this amount. The only solution thus far is to manually edit each invoice which is tedious and will take hours. 

I have watched all the videos and nothing seems to work. It almost seems like QBO doesn't even recognize this is happening much less be developing a solution.  https://quickbooks.intuit.com/learn-support/en-us/help-article/sales-taxes/learn-quickbooks-online-c...

Great video, however no help. Again, its impossible to avoid "based on Location",  edit the amount it charges, or make alternative selections except manually adjusting individual invoices. 

have you gotten any help on this?

Hello there, @cdaugherty.

I understand the importance of turning off the sales tax in QuickBooks Online (QBO).

We have the option to turn off sales tax, however, not to a specific location. To turn off sales tax in the automated sales tax, here's how:

1. Go to Taxes, then select Sales Tax.
2. Select Salex Tax Settings, and select Turn off sales tax.
3. Select Yes to confirm.

You may also check this article for detailed information: Turn off sales tax.

For now, I recommend sending feedback to our developer about your experience to enhance your experience if there are incoming changes soon.

Here's how:

1. At the upper right corner, click the Gear icon.
2. Under the Profile, select Feedback.
3. Enter your comments or product suggestions.
4. Then, select Next to submit a feedback.

For more details about the feedback process, you can check this article:  Submit feedback.

For your reference, I'll add this article to guide you in editing your sales tax rate: Edit sales tax rate.

Please don't hesitate to leave a comment below, if you have further concerns about turning off sales tax or other QBO-related concerns. We're always here to help you out.

I have not gotten any help on this. @cdaugherty  I use BigCommerce, Avalara, Webgility, and Quickbooks. I have the same issue you have, Ultimately it depends on your situation, I only have Nexus in VA currently. Anything I ship to another state does not get taxed. If they choose in-store pickup, then I need to charge VA tax. BigCommerce asks the customer to enter their ship to address at check out, then they select the pickup in-store. Avalara does not recognize it is a pickup and defaults to based on location(shipping address). I have spent hours with both teams. Avalara says they need additional assets to be sent over with each order. I put the Avalara developers in touch with BC developers and BC was unwilling to work with Avalara to fix this issue.

You have a direct connection with QB and your tax software, I don't have any insight here, other than trying to get each side to see if they can fix it. I would start with your tax software company. Sorry I don't have any better information for you. For us, i only have to manually change out of state orders that are pick-up, add VA tax and discount the order to keep the total the same as what the customer was charged. I will definitely follow up if i find a solution.

I've had the same issue since QBO forced the new sales tax calculations on us. I've spent countless hours on the phone with QBOO support, even spent a couple of hours on a screen share allowing them to screen shot the issues only to be told later "We appreciate your patience while we looked into your issue. After investigating the issue, we found that we did not receive enough information to complete an in-depth investigation to your concern."

I don't know what else they need. They plainly see that the Based on location is only applying City and State sales tax rates and NOT including the required County sales tax rates. They need to fix this ASAP!

It isn't the kind of experience we'd like you to have, @DSFjon.

I see you contacted support about your sales taxes concern, which is not calculating properly in QuickBooks Online. Thus, I still recommend reaching out to our Customer Care team again. Since the Community is a public forum, we don't have the ability to open your account for security. Our Customer Care team can open and check further information with your account. They can also see what has been done with your previous interaction with them.

Here's how:

1. Sign in to your QuickBooks Online account.
2. Click Help (?).
3. Choose either tab to get started:

• Assistant: Get quick, personalized answers. Select a suggested option or type a question or topic you need help with. If you need further help, you can still Talk to a human.
• Search: Search the QuickBooks Online knowledge base directly, or select Contact Us and choose a way to connect with us:
  • Start a chat with a support expert.
  • Get a callback from the next available expert.

For future reference, you can read this article to help you run and manage reports in QuickBooks Online:

• Run reports in QuickBooks Online.
• Customize reports in QuickBooks Online.
• Memorize reports in QuickBooks Online.

Feel free to click the Reply button below if you have other questions about sales taxes in QuickBooks Online. I'm always here to help. Have great day.

The main issue here is that Intuit has introduced a new feature and it has not informed its employees of the new product, trained any of its employees on how the new feature works and Intuit has not updated it boiler plate step by step instructions on how to fix the issue. I spent 2 hours on the phone and the conversation started off with the same gear icon solution.  After repeating myself at least 15 times and after doing the screen share where the "expert" could see that we didn't have rates set up for Wisconsin, there was a long pause and the "expert" made the statement "So you are saying quickbooks online can calculate taxes and that you don't have to set up a rate? I had no idea such a thing existed." What really threw the "expert" for a loop is that I was pointing out that Intuits automatic calculation was charging the incorrect local rate for Milwaukee.  She was convinced that we had set up a rate that was wrong.  Fast forward and there is now a "case" and Intuit has not fixed the wrong rate they have for Milwaukee.  Instead the same 7.5% is being automatically calculated instead of the correct 7.9%.  Avatax may have been challenging to set up 6 years ago on desktop, but to their credit they at least got the tax rates correct and more importantly if you called in to let them know of an error, the rate was fixed while you were on the phone - no 4 weeks and counting.  It is clear the issue is that Intuit has not informed its "experts" of the product they are offering and consequently the "experts" can't fix it because their step by step sheets does not show that the product exists.

So what are we to do. The sales tax for my location should be City of Mobile (5%), Mobile County (1%), and State of Alabama (4%). When. reported this, their automated calculation was leaving out Mobile County. Interestingly enough, it's worse now as it is now only applying State of Alabama, leaving out both the City of Mobile and Mobile County. So frustrating that a company the size of Intuit would cause such harm to their customers by introducing faulty features that create hour upon hours of manual work. 

DSFjon, I created a custom tax rate so that on orders that say based on location that need to be my jurisdiction, I can now select the drop-down and pick my custom tax which ties to my sales tax. I still have to watch what the tax is as i change it, sometimes it changes by a penny and I need to change it back to the correct amount that was charged. I suggest searching this to help set it up. I attached a picture to show what I mean. The top VA tax is standard in QB and I created the bottom one which is the same tax but broken down. Having this custom tax allows me to switch it from based on location to my custom rate. For me, if a customer buys online and they are in another state and do pickup in-store, They don't get charged sales tax so I have to switch their order in QB to my custom rate and then apply a discount so the total stays the same as what they were charged. Quite annoying. For me, it is my online host not willing to work with my sales tax software company. Hope the custom rate helps you some.

DSF - The solution is a solution that works for the short term but sales tax rates change and if a state changes its rates you then have to update your rate and there is the potential it could be updated without you knowing.  Intuit is marketing its "based on location" product as a replacement for Avatax and it is not working the way it should work. 

The main issue is that Intuit needs to 1) Inform and train its "experts" on this new sales tax process 2) Have a submission process for allowing users to notify Intuit of errors.  The preferable solution is a reporting link within quickbooks online that is monitored 24/7/365 by intuits based on location team so that rate errors can be corrected within 24 hours like Avalara does with their rates.

We collect sales tax in 10 states and would not have caught the .4% error until filing our monthly return which at that point means a write-off of what was not collected. Also, our customer that that rate affects is a publicly traded company, largest in its industry with $18 Billion in revenues per year.  I'm sure their legal department would have a field day with Intuit being grossly negligent with the tax rates it is providing its customers.

That being said, Intuit won't take more of an interest until they see the ramifications of their negligence hitting their bottom line and I'm recording the issues I'm finding, their responses and lack of responses. 

While we switched a month ago to QBO from Desktop Premier, we have about 6 more months of work bringing the system up to the point where it was 30 days ago on premier.  The migration lost over 130,000 attachments which have to be manually reattached and every customer (all 2148) have to be fixed so that the well known glitches don't occur.  We've found solutions to most of the glitches and are in our final run through of updating all customers again. 

While it is a different message board string, there have been a lot of complaints about not being able to run a sales by customer summary for categories of customers and that only the sales by customer detail is available.  To correct that issue, the sub company can be clicked within each customer.  It's a royal pain in the rear, but we are in the process of switching our publicly traded companies with 300+ locations to that format.  It is inexcusable that Intuit does not have a batch operation to make those updates. But it is what it is and rather than complain about it I'll use my grandfathers lesson he taught me over 40 years ago - wish in one hand and crap in the other.  See which one gets full faster. 

If their negligence causes financial harm to my business, then I'll let the lawyers work out those details.  Thank you again for your solution and hopefully it will spur Intuit to do the right thing and finally correct incorrect sales tax rates in their based on location system.

Unbelievable that it is now June, 2024 and this issues has not been rectified by QuickBooks Online team.  What is the hold up?  We invoiced a customer based on the assumption that using the location to calculate sales tax was correct.  We now have to go back to the customer for the additional sales tax.

Unacceptable!

Hello there, @Sduggan. When creating an invoice in QuickBooks Online (QBO), the sales tax will be automatically calculated based on your sales tax setup, the customer's tax setup, and the shipping location you select. I'll explain this further.

If your sales tax and your customer's sales tax are set up correctly based on the location, QBO will auto-calculate the tax for each invoice. You can review the total rate calculation by clicking See the match and checking the location and addresses. If you notice any issues with the setup, you can edit it to make corrections.

However, if everything is set up correctly and still encountering issues, performing browser troubleshooting is recommended. Browsers can accumulate temporary internet files that may affect your browsing experience and impact the behavior of your QBO company. You can open a private window using the following keyboard shortcuts:
 

• Google Chrome: Ctrl + Shift + N
• Mozilla Firefox: Ctrl + Shift + P
• Safari: Command + Option + P

Check out this article for a step-by-step process on clearing your cache: Clear cache and cookies to fix issues when using QuickBooks Online.

Additionally, to understand more about how QBO calculates sales taxes, I recommend checking out these references:
 

• Use automated sales tax on an invoice or sales receipt in QuickBooks Online.
• Learn how QuickBooks Online calculates sales tax.

Moreover, to further manage sales tax payments in QBO, you can visit this link: Manage sales tax payments in QuickBooks Online.

Let me know if you want me to help you further or if you have more questions about handling sales taxes in QBO. I'll circle back to assist.

Why is QBO suddenly bypassing the sales tax setting in customer's account and defaulting to "Automatic by location". When I contact them, they tell me to call Clip. If QBO is not operating based correctly and bypassing the settings, how is it not a Quickbooks problem? Asking this question has resulted in my being disconnected from chat sessions with QB three times! They just hang up on me. It's crazy. A couple of weeks ago, there were clearly changes made to the QB program that has caused do many problems. I am finding there to be zero accountability. Seems the strategy is to blame the user or any other software you use. 

I've found the best way to get a response is to click the feedback icon on the screen in which you are having the issue.  That being said, the issue I wrote about in February still has not been corrected and we have to manually override the tax rate.  

However, by clicking the feedback button, I did receive a response from a knowledgeable employee and they took the information and contacted the Wisconsin DOR.  According to Intuit they work off of a database provided to them by the Wisconsin DOR.  The address range in which our customer falls is outside of the Wisconsin DOR range sent and they have to wait for the Wisconsin DOR to send a corrected database.  That is 12 weeks ago and counting. 

As bad as some of the things are with QBO, I have to say it has grown on us ... nothing will ever fix the 130,000+ documents that did not make the transition from Desktop to QBO but we managed to re-upload about 40,000 of them which has made things much smoother than going back and forth for data between QBO and QBD.