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Sales Tax Liability Report Question

In almost all cases, when we look at our Sales Tax Liability Report, the amount under 'Tax Collected' simply equals 'Taxable Sales' x 'Tax Rate'.


However, within our State (Nebraska), for our City (Omaha), 'Tax Collected' does not work that way.

For example, right now, 'Taxable Sales' = 46694.18 and 'Tax Rate' = 1.5%, but 'Tax Collected is 3,112.08.


Tax collected is closer to city + state rate of 7.5%!

So, just trying to understand, does QB automatically use City + State rate for your location to determine 'Tax Collected'?

...Our book-keeper asked, so trying to provide a good answer...

Community Champion

Sales Tax Liability Report Question

On the report, the tax collected number is not calculated using the rate.   It is instead the sum of the tax amounts on your sales transactions for the period of the report.


You can double-click on the amount to see the individual sales tax amounts for each sale.

QuickBooks Team

Sales Tax Liability Report Question

Hello, @FJH.


I'll share with you some knowledge about how QuickBooks Desktop collects sales tax. 


I'd agree with BigRedConsulting that the tax collected amount is not computed using the rate. And QuickBooks won't automatically use City and State rates for your location to determine tax collected. The reason is that you manually select the sales tax in that specific transaction. 


To learn more about this, check out this article: Collect sales tax.


This will also depend on the item you've selected and the default sales tax saved in the system. With this, I'd suggest reviewing the preference of your tax. 


Here's how: 


  1. Go to the Edit menu, then choose Preferences
  2. Select Sales Tax and hit Company Preferences
  3. Review all the data. 


For more information about the sales tax, visit this article: Set up sales tax in QuickBooks Desktop


I've also added articles about handling tax forms, reports, and other topics. 



Let me know in the comment section if you have follow-up questions regarding this. I'm glad to help. Keep safe!

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