Sales use tax

I know ways how to track sales taxes you owe on vendors, @Nicolet31. Let me elaborate on them in detail.

To keep track of sales tax on non-sales transactions such as Bills, Checks, and Purchase Orders, you'll have to enter them manually as QuickBooks isn't designed to record them automatically. In QuickBooks Desktop (QBDT), you have the option to track them as an Expense or a Liability, based on when they are expected to be paid.

Here's how:

As an Expense (not to be paid later)
 

1. Create an Expense account.
   a. In your QBDT file, go to the Lists menu, then select Chart of Accounts.
   b. In the Chart of Accounts window, right-click anywhere and select New.
   c. Select Expense in the Choose Account Type window, then click on Continue.
   d. Enter the Account Name and other details then select 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 expense account created in Step 1.
3. Enter the amount of sales tax in the Amount column. Note: This will need to be calculated manually.
4. Ensure that any detail in this transaction adds up to the correct total after clicking Recalculate.

For detailed steps on how to track sales tax as a Liability (to be paid later), kindly visit: Track sales tax on purchases from vendors.

Moreover, to have a report that shows the amount you owe, you can run an Account QuickReport in QuickBooks. Here's how:
 

1. In your QBDT file, go to the Lists menu, then select Chart of Accounts.
2. Locate and select the account you created for the sales tax.
3. Click on the Reports dropdown, then select QuickReport.
   
   

To keep a precise record of the taxes you have collected and ensure their timely remittance to the relevant tax collection agency, you may find this article helpful: Process sales tax adjustment.
 

I'm still open and ready to answer any questions you may have with your taxes, reports, or any QuickBooks-related. I'm just a comment away always.

Thank you for your response.  I have read all the posted material but don't think I have an answer yet or a solution on how to handle.

So, if I am entering an invoice for a vendor and let's say It is for $100.  I will need to pay State Sales Tax of $6.00 because they didn't charge me sales tax.   I can't enter the $6.00 on the invoice because I will have the wrong amount for the vendor total.  

The only thing I can see is entering this $6.00 into another account name State SALES Tax account and keep a running total?

Just wondering if there is an easier way to do this?

Thanks for following up with the Community, Nicolet31.

If you're going to pay your sales tax upfront, you'd make it hit an expense account. In the event you're looking to pay it later, it will need to hit an other current liabilities account. If you know what its amount should be and don't want it to appear on your vendor's bill, you can create a separate transaction for it.

To properly determine which type of transaction and account you should be using for it, I'd recommend working with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

Here's how it works:

1. Go to our Find a ProAdvisor page.
2. Use the City or ZIP search field to specify a location.
3. Select Find a ProAdvisor.
4. Browse through your results and find one that works best for the business. You can click on each ProAdvisor's profile to learn more information about them.
   
   

Once you've found an accountant, they can be contacted through their Send a message form:
 

1. Use the available text box to introduce yourself. Be sure to include details about which services you're looking for.
   
   
    
2. Enter your appropriate info in the Your name, Your email, and Your phone number (optional) fields.
   
   
    
3. Select Send message.
   
   

You'll also be able to find many detailed resources about using QuickBooks in our help article archives.

If there's any additional questions, I'm just a post away. Have a lovely day!

@Nicolet31 

You have a couple of options in your example:

1) Create a bill: Enter the expense or asset account as a positive $6.00 and enter the appropriate sales tax account as a negative $6.00.  The bill will net to zero and show as paid.  This method is preferable, IMO, as it will record the transaction under the vendor. 

2) Create a journal entry (JE): debit the same expense or asset account as the vendor bill and credit the appropriate sales tax account for $6.00.  Make a note on the JE regarding what bill it applies to so you can find it in case of a sales tax audit.

Both options will book the sales/use tax as an expense (or add to your basis if an asset) and a corresponding amount to your sales tax liability to be paid at a later date.