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Level 2

Sales tax group rounding

So our sales tax =9.2% if I plug in the city tax 2.9% and county of 6.3% =9.2% for the sales tax group

some invoice amounts the sales tax will round up or down a penny.

But if I make a sales tax item of the 9.2% it is perfect.

Is there any way to fix this?

Will it mess up my TPT when filing each month because we collect a few more pennies than we should?

Thanks!

10 Comments
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Anonymous
Not applicable

Sales tax group rounding

Good day @bspeed.

 

Let me help share some information about the sales tax calculation in QuickBooks.

 

There are times that a sales tax amount will automatically round up or down when calculated based on the amount of the invoice or sales receipt. If there are a few more pennies collected, you can process a sales tax adjustment to make sure you keep an accurate record of these taxes. 

 

For the detailed steps on how, please refer to this helpful article: Process sales tax adjustment.

 

This article will lead you on the right track. If you need assistance with the steps, feel free to contact our Desktop Care Support. They can access your account in a secure environment and help you navigate easily using their screen share tool.

 

  1. Go to: https://help.quickbooks.intuit.com/en_US/contact.
  2. Choose your QuickBooks Product.
  3. Select your QuickBooks Version.
  4. On the Contact Us page, click a topic.
  5. Click on the Get Phone Number button to see the support number.

I'll be on the lookout for your reply if you have other questions about sales tax. :)

 

Highlighted
Level 15

Sales tax group rounding


@bspeed wrote:

So our sales tax =9.2% if I plug in the city tax 2.9% and county of 6.3% =9.2% for the sales tax group

some invoice amounts the sales tax will round up or down a penny.

But if I make a sales tax item of the 9.2% it is perfect.

Is there any way to fix this?

Will it mess up my TPT when filing each month because we collect a few more pennies than we should?

Thanks!


This BUG has been in QB since 2006 when I started

 

intuit knows about it, I posted with a developer how to fix it in 2008, helped him do the code

intuit just does not care IMO since the fix was never implemented.

 

intuits solution is adjust sales tax payable, and as far as the present sale is concerned, they are not concerned.

Their "fix" is to use a non inventory item set to non taxable to adjust the invoice total up or down.

 

 

Highlighted
Level 2

Sales tax group rounding

So they expect us to figure up sales tax on every invoice to make sure it's right, then keep track of it with a separate item? I've been dealing with this for years and just send the excess collections to the state. It's bull because why does it round up when you have whole numbers. Not to mentions I collection different amounts of sales tax in NC where counties have different rates. I don't have time to do THEIR job. I pay for accounting software to work. Otherwise, I mind as well just keep a ledger. 

 

This is a pain because I'm using two different systems and they don't balance which makes me have to create another line item to offset the difference. What a bunch of crap! Typical Quickbooks BS.

Highlighted
Moderator

Sales tax group rounding

Thanks for joining this thread, Matt K.

 

I appreciate you for sharing your thoughts about the rounding off behavior of sales tax to some invoice amounts. In the meantime, you can process sales tax adjustment to correct the tax amounts. 

 

While our engineers continue to develop a concrete resolution, I encourage you to visit this link: https://www.firmofthefuture.com/product-industry-news/product-updates/. I want you to be updated with the most recent happenings and future developments of QuickBooks Desktop.

 

You can always get back to me for any questions. I'm always delighted to help. Wishing you well.

Highlighted
Level 2

Sales tax group rounding

Yes. I've already looked over that and I do Adjust the sales tax when something doesn't equal out correctly. However, on a current invoice this becomes an issue. I'm a designer, not a book keeper. Spending more time in my books, keeps me from doing what I'm in business to do. Having to calculate each invoice to recheck QB calculations is ridiculous. I use memorized transactions as well AND have to collect sales tax for multiple counties that have varying percentages. I don't have time to do this and then have to issue credit memos for each one. As the guy stayed this has been an issue since 2006. How many years do you need to fix something like this. 14 years I believe is plenty of time. 

Highlighted
QuickBooks Team

Sales tax group rounding

Hey there, @Matt K.

 

I'm here to provide some insight into adjusting sales tax.

 

With the calculations provided above, 6.3% plus 2.9% equals a total of 9.2%. When QuickBooks does the math, the amount ends up being off by a few decimal points. Meaning it rounds up or down to the nearest cent. Allow me to provide an example:

 

Take the number 6589.67 and multiply it by the two percentages 6.3 and 2.9:

 

6589.67 X 0.029 = 191.10043
6589.67 X 0.063 = 415.14921

 

Then add them together:

191.10043 + 415.14921 = 606.24964 or 606.25 (rounded to the nearest hundredth)

 

If we take the same amount and multiply it by 9.2%, it is the same amount:

 

6589.67 X 0.092 = 606.24964 or 606.25 (rounded to the nearest hundredth)

 

The amount is the same in both situations, yet the way that the numbers round can be different. Depending on your invoice amounts, the numbers can differ, causing that penny difference. The taxes will then balance themselves out by rounding the opposite way each tax period. Meaning you don't have to recalculate the tax difference for every invoice you make.

 

If you have any other questions or concerns, please drop a comment below.Best wishes!

Highlighted
Level 2

Sales tax group rounding

That may be true for your example as it is a random number. However, I have an invoice total of $650.00 with a combined sales tax of (4.75% + 2.25%) equalling 7%. I am using Dubsado online platform which calculates the total with tax to $45.50. But QB 2020 Desktop (and all versions prior) calculate the tax to be $45.51. Making the final total to be $348.01 instead of an even $348.00. 

 

Also, you mentioned that QB balances out for each quarter. But that isn't so, as I've been collecting excess tax (and remitting it) for years now. So no, it doesn't balance out. What it does is cause me to have recalculate my sales tax because when I put my total in form NC-500 it gives me the non-rounded up (actual) tax, which means I have to double check my numbers because the sales tax that QB is showing that I have collected is over what the NCDOR says I owe. As you know even pennies make a difference in a balance sheet. 

 

Yes, I would rather owe the money and have collected it, instead of vice versa, but this make it a pain when trying to keep two sets of books. Something that online software has made a really difficult to manage.

Highlighted
Level 1

Sales tax group rounding

The problem with the solutions offered so far, is that I sell to cities and states that have to have the invoice received from me, match their PO EXACTLY. So when the sales tax does it "rounding" quirk, they can't pay the invoice and when I try and adjust it by subtracting a penny from the product total, it swings 2 cents in the opposite direction. I am dealing with this right now on an invoice that is over 60 days. My back shop software always figures the sales tax correctly, so I know it can be fixed. It the Quick Books software that can't seem to get it right.

Highlighted
Moderator

Sales tax group rounding

Thanks for sharing your insights and feedback, @bbjacks2000,


Having the automatic rounding turned off in QuickBooks is definitely a handy feature when added in the program. This would save time so you won't manually adjust any taxes derived from the invoices. 

 

Our product developers take utmost effort to bring useful enhancements and updates based on what our customer needs. I'm personally sending this request to our engineering team and your vote for this one.

 

In the meantime, you can follow the suggestion to adjust the taxes manually to ensure accurate tracking on your quarterly returns. Check out the links below based on the program you're using:

 

QuickBooks Desktop: Process sales tax adjustment.

QuickBooks Online: Create or delete a sales tax adjustment.

 

If you have any other questions, let me know and I'll be happy to help. Thanks again for checking out our forums and have an awesome Thursday!

Highlighted
Level 1

Sales tax group rounding

This rounding problem on tax inclusive invoices have been around for years and despite of numerous feedback, there is no sign of improvement.  We import thousands of Invoices using transaction pro into Quickbooks online and have to manually edit the sales tax after importing. 

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