Sales Tax Liability Report has faulty data

Allow me to explain some information about the automated sales tax and sales tax liability report in QuickBooks, Service.

The Sales Tax Liability report is a summary of your sales and taxes. In the Total tax amount column, you can see how much tax you collected from your customers. This includes the state rate and local tax rates. Also, you can select any tax amount to open a transaction report that shows how much tax you charge for each sale, as well as more information, like customers, transaction dates, and tax rate.

On the other hand, QuickBooks automatically calculates the total sales tax rate for each sale based on the following:

• Your customer's sales tax exempt status.
• Where you sell and where you ship.
• Your service or product's sales tax category.

QuickBooks Online keeps track of your state's tax laws to accurately calculate sales tax and returns. If you charge sales tax outside of your state, you can also add other tax agencies you pay. Tax rates can also change if you ship products or perform services at your customer's address.

For more details, about the details above, you may open these articles:

• Check how much sales tax you owe in QuickBooks Online
• Set up and use automated sales tax in QuickBooks Online

However, if you set up the taxes correctly and the issue persists, I'd recommend contacting our Customer Support Team. The sales transactions and tax liability report can be reviewed to show the correct data. To reach them click this article: QuickBooks Online Support.

I've also added these references to help you save the report with its current customization settings and how to automatically save the sales tax you get in an envelope:

• Memorize Reports in QuickBooks Online
• Set up and use Smart Sales Tax Envelope

If you have any other questions about sales taxes and reports, please let me know. I'll get back to you as soon as I can. Take care.

In this example:

Date: 3/15/2024

Transaction type: Receipt

Number: XXXX

Name: Joe Smith

Tax name: Chicago city tax

Tax rate: 3.5%

Tax amount: 00.00

Taxable amount: 100.00

How can I have a taxable amount for a non-taxed item? No tax was collected for the item but QBO shows the amount as taxable. 

Hello there! Let me share some insights into what might be causing this issue you're experiencing with the sales tax.

QuickBooks can sometimes show taxable items as not taxable due to incorrect settings. To address this issue, users can manually change inventory settings to ensure all items are taxable, adjust sales tax categories, or edit historical transactions to correct tax settings. 

In cases where users need to label non-taxable income in QuickBooks, they can create a sub-account under Other Income with a tax line of Non-Taxable to segregate non-taxable income from taxable income. This method allows users to categorize income correctly and differentiate non-taxable income from taxable income for accounting purposes.

Additionally, I'd recommend contacting QuickBooks Online Support for further assistance in resolving these discrepancies. In situations where incorrect tax calculations persist, contacting QuickBooks Technical Support for advanced assistance is recommended to address any underlying issues causing the miscalculations.

Also, to view more insights and information about applying sales tax rates to transactions and sales forms in QuickBooks Online, click here.

If you need help or any clarification with sales tax-related concerns, don't hesitate to reply to this thread. I'll always be here to help you out. Have a great day!

Sales Tax Liability Report

It is terrible!!!! I so fed up that I am SERIOUSLY considering dumping QBO.

I have requested help from QBO but to date NO ONE can interpret it for me. The QB people live in their little expertise boxes none apparently deal with this. Can you help to point me in the right direction. 

The Report headings do not match. 

I recognize your frustration with the Sales Tax Liability Report headings do not match, @Desimoto. I know that this situation affects your business. Let me give you some information that can help you solve this.

What happens when you try to run the sales tax liability report? I will provide you with some steps on how to run the report. I will provide you with those steps. Here's how you can get the right report that you want: 

1. From the Reports menu, choose Vendors & Payables > Sales Tax Liability.
2. Double-click the Total for Total Sales column to double-click the Total for Total Sales column. The Sales Tax Revenue QuickZoom report will be displayed once you click this.
3. You can customize the report. Select the appropriate reporting method, accrual or cash. Under the Display tab, select the date range for the report.
4. Choose Accounts under the Filters section. Select All ordinary income accounts from the menu. You can choose Multiple Transaction Types from the drop-down menu under the Filters tab.
5. Put a checkmark next to all transaction types, excluding invoices and receipts. To return to the Filters window, please select OK. To return to the report, select OK again and select OK again.

For additional information, check out this article to fix the problem, and compare the details of the totals by running the Sales Tax Liability report and The Profit & Loss Standard report:   Total sales are different from total income.

Moreover, I'm adding this article to learn how to get the most out of your financial reports: Customize reports in QuickBooks Online.

Stay in touch if you have questions about the Sales Tax Liability Report. I'll be around to provide detailed instructions for them.

I do not think we have the same version of QBO as where you are directing me does not match. Is there somehow, I can talk to you or someone else in person.

I am trying to just get an interpretation of what this report is showing me. 

For example. The two top lines show the same amount for both state & District amounts across the board.

If I export the report to Excel, I come up with different amounts for quite seriously should be a simple straight forward report. I do not understand why QB produces reports that appear to go out of their way to confuse simple issues. 

Also, if I cannot communicate directly with you can your other suggestion, please be a department that deals with this reporting function.

We appreciate you for coming back here in the thread, Desimoto. Let me help you with the support to help you further with your concern. 

If you are facing a hurdle with understanding the Sales Tax Liability report, the team support will be hands-on in helping you. They can guide you through and assist you in identifying your goals for the report. Additionally, they can also help you interpret the report in QBO and provide you with any other clarification that you may require. Here's how to reach them:

1. In your QuickBooks, click Help (?).
2. Select either of these tabs:

• Assistant tab and select Talk to a human.
• Search tab and click on Contact Us to connect with a support expert.

If you're using QBO Plus, Essentials, or Simple Start, the support team is only available Monday to Friday from 6 AM to 6 PM Pacific time and Saturday from 6 AM to 3 PM Pacific time. And if you're using QBO Advanced, you can reach the support team any time from any day.

On the other hand, I'll add this article to help you save the current customization settings you set up when running a report in QBO: Memorize reports in QuickBooks Online. 

If you have follow-up questions, let me know by leaving a comment below. I'm here to assist you again. Keep safe. 

Hi KayePe

I have used the phone process however I seems the following things happen.

1. The person is in a different dept & forwards me to another one & I am cut off.
2. The person is cut off while talking to them & I have to begin the process again then back to #1
3. The person cannot help, passes me onto a supervisor who also cannot help.

That is why in my previous post I inquired who or what is the best person or Department to contact?

Even my latest bookkeeper is baffled by how the report is conceived.

We were having this same issue. It was marking all nontaxable products/services as taxable even though it wasn't calculating a tax amount due as the tax checkbox was not selected on the invoice/sales receipt. I have seemed to fix our issues.

First, I created a new Other Income - Other Misc Income for all my nontaxable items (we are healthcare facility and insurance payments for claims and patient payments are nontaxable). We also sell supplements, so we have combinations of both taxable and nontaxable items on invoices/sales receipts. 

Second, we do not use SALES RECEIPTS anymore. Sales Receipts were constantly calculating taxes incorrectly and then you can't just delete to correct because then you lose your payment transaction information. I know there are work arounds, but it was easier to switch to invoices and then receive a payment.

Third, we changed our nontaxable items to "Service marked exempt by its seller where seller accepts full responsibility -> Miscellaneous". under the tax category when editing the products.

You can type "exempt" in the Seach bar under 'Describe this product (tax type)' when you click on the 'edit tax' link in the 'edit product' section.

We also created a class named "NT" and associated that with all of our nontaxable items so it's easier to sort on reports.

Once you do all this, then change your product's income account to your new Other Income acct and check the box to update transaction history. 

** We also utilize the QB app "Bulk Import - saasant transactions" to be able to modify and add items in bulk. You can download items to excel to check which tax classification each product falls under.

examples:

I believe these are the correct codes.

EUC-09020802-V1-00120000 - Retail Taxable Item

EUC-99990201-V1-00020000 - Non-Taxable Item

Once you correct the items with the correct tax classification and save the new file. You can click the Modify Tab on the menu on the 'Bulk Import app' and then upload the edited file so it corrects the items vs creating new items [it references the QB Database ID# to use to match it.]

You can also use the "Bulk app" to modify your invoices/Sales Receipt via LIVE EDIT or you can download to excel in bulk, modify them and uploaded corrected file to the 'MODIFY TAB'. It gives you several more options to edit then using QB's live edit option.

Hope that helps.