cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Level 2

Sales Tax in Florida

We are a warehouse and manufacture and sell boat accessories.  The sales Tax here in Florida is 7%.  If any sale is over $ 5,000 the sales tax amount is 6%.  I need help setting the two amounts in quickbooks and how will quickbooks no to calculate the correct tax amount?  thankyou

Solved
Best answer December 20, 2018

Best Answers
Highlighted
Anonymous
Not applicable

Sales Tax in Florida

In Florida for some sales, while the overall 5% sales tax rate applies to the entire sale, the local tax (1% - 2%) applies only to the first $5000 of the sale.

 

This can be set up in QB, but it is tricky.

 

In order to set this up, you'll need two tax items, one for the state tax and one for the local tax.

- For any sales under $5000 you can also set up a sales tax group that contains both items and use it on the bottom of the invoice as normal for a group tax item.

- For sales over $5000:

1) Create a taxable other charge and call it something like Adjustment for Local Tax (or whatever you fancy.)  Set it's rate as $5000.

2) Create a Group item (not a sales tax group, but a regular group.  The Group will have three items:

Adjustment for Local Tax: Qty 1

Fl Local Sales Tax item

Adjustment for Local Tax: Qty -1

Note the option to print or not print detail on the item.  Don't print the detail.

Cleverly name the group something like "FL - Local Tax 1%" and give it a description something like "FL - Local Tax 1% - first $5000"

 

3) When making a sale, first enter the sale details, then use the group you've set up in step 2 and use the 5% Florida tax at the bottom of the invoice.

 

The resulting invoice will apply $5000 taxable sale to the 1% tax and the entire sale to the tax at the bottom of the invoice.  The invoice total will automatically be correct and the sales tax report will also be correct:

 

The invoice when printed will hide the details of the group:

 

 

Capture.JPG Capture2.JPG

 

 

 

View solution in original post

22 Comments
Highlighted
QuickBooks Team

Sales Tax in Florida

Hey there, Stayseea.


Thanks for visiting the QuickBooks Community. I'll be your guide today in setting up the Florida sales tax.


Currently, the desktop version doesn’t have the option to automatically change the rate when it reaches the sales tax limit. For the software to start using the new rate, you have to set it up and enter it when creating invoices.


When setting up the sales tax, make sure to first turn on the Preferences. For the step by step process, follow these steps:

 

  1. Go to Edit at the top menu bar.
  2. Select Preferences.
  3. Click on Sales Tax on the left panel.
  4. Under the Company Preferences tab, select Yes.
  5. Click on Add sales tax item.
  6. In the New Sales Tax Code window, enter the code.
  7. Then assign a sales tax rate and tax agency.

To create a new sales tax item:

  1. Select Sales Tax in the drop-down.
  2. In the Sales Tax Name field, enter your preferred name for the tax item. It is advisable that you use the location of tax for the name
  3. In the Tax Rate (%) field, enter the 7% or 6%.
  4. In the Vendor Name field, enter the name of your tax agency. For example, the Florida Department of Revenue.
  5. Click on OK.

I've attached an article that will visually guide you through the steps: Set up sales tax.

 

With these steps, you can effectively track the Florida sales tax. 

 

If you additional questions about QuickBooks, reach out back to me. I'll be around to answer them. Have a great day ahead.

Highlighted
Anonymous
Not applicable

Sales Tax in Florida

The tax has a higher rate on the first $5,000 of a taxable sale, and then drops down - because the local tax is limited.  Setting up two tax items to pick between will not work.

http://floridarevenue.com/taxes/taxesfees/Pages/sales_tax.aspx

Highlighted
Anonymous
Not applicable

Sales Tax in Florida

In Florida for some sales, while the overall 5% sales tax rate applies to the entire sale, the local tax (1% - 2%) applies only to the first $5000 of the sale.

 

This can be set up in QB, but it is tricky.

 

In order to set this up, you'll need two tax items, one for the state tax and one for the local tax.

- For any sales under $5000 you can also set up a sales tax group that contains both items and use it on the bottom of the invoice as normal for a group tax item.

- For sales over $5000:

1) Create a taxable other charge and call it something like Adjustment for Local Tax (or whatever you fancy.)  Set it's rate as $5000.

2) Create a Group item (not a sales tax group, but a regular group.  The Group will have three items:

Adjustment for Local Tax: Qty 1

Fl Local Sales Tax item

Adjustment for Local Tax: Qty -1

Note the option to print or not print detail on the item.  Don't print the detail.

Cleverly name the group something like "FL - Local Tax 1%" and give it a description something like "FL - Local Tax 1% - first $5000"

 

3) When making a sale, first enter the sale details, then use the group you've set up in step 2 and use the 5% Florida tax at the bottom of the invoice.

 

The resulting invoice will apply $5000 taxable sale to the 1% tax and the entire sale to the tax at the bottom of the invoice.  The invoice total will automatically be correct and the sales tax report will also be correct:

 

The invoice when printed will hide the details of the group:

 

 

Capture.JPG Capture2.JPG

 

 

 

View solution in original post

Highlighted
Level 2

Sales Tax in Florida

Thank you for getting back to me.  My problem is, here in Florida, there are two rates.  One being After $5,000 6%.  Less than $5,000 would be 7%,  If I have one line item or service that's let's say $6,500, how would I add the taxes without the invoice looking like a mess?  Thanks

Highlighted
Level 2

Sales Tax in Florida

Thank you if can explain the set up, I'd appreciate it.  My problem is going to be more when I have a sale that's $6,500 on one line item and the $5,000 has to be 6% and the remainder at the 7%.  Peachtree had a formula you can use.  Does Quickbooks have this?

Highlighted
QuickBooks Team

Sales Tax in Florida

Hi there, @Stayseea,

 

Thank you for getting back and clarifying your concern. I agree and recommend the answer provided by BRC in setting up sales tax for Florida.


At this time, you have to create two tax items to follow your state mandate. Intuit's goal is to provide our customers with the best experience and cater to the needs of each business. Your suggestions on how we can improve and make it better can help us achieve it. 

 

Please send your idea to our engineers to evaluate and consider this on future update:

  1. Click the Help menu bar.
  2. Scroll down to Send Feedback Online.
  3. Select Product Suggestion.
  4. Select Product Suggestion for the Type of Feedback.
  5. Product Area is optional.
  6. Enter your suggestion.
  7. Click Send Feedback.

Feel free to reach out back to me if you have other questions about QuickBooks. Wishing you all the best. 

Highlighted
Anonymous
Not applicable

Sales Tax in Florida

RE: Thank you if can explain the set up, I'd appreciate it.

 

I think I did that in great detail on my post.  It will do what you are asking for. Reply

 

Highlighted
Level 1

Sales Tax in Florida

Hello!  I am trying to go through your steps and had a quick question:

In step one- can you explain in detail how you create a "taxable other charge"?

Thank you so much!

 

Highlighted
Moderator

Sales Tax in Florida

Hi there, radley.

 

It would be my pleasure to lend a hand with creating a taxable Other Charge Item in QuickBooks Desktop.

 

Here's how:

 

  1. Go to the Lists tab at the top menu bar.
  2. Click Item List.
  3. Click the dropdown arrow next to Item.
  4. Click New.
  5. Below Type, select Other Charge.
  6. Below Item Name/Number, enter a name (ex. Adjustment for Local Tax).
  7. Below Tax Code, choose Tax.
  8. Click OK.

Please feel free to get in touch with me here for any additional questions. The Community always has your back.

 

Highlighted
Level 2

Sales Tax in Florida

I tried this out on a sample file and it did finally work.  Thank you

Highlighted
Level 1

Sales Tax in Florida

Thank you so much! 

I was actually able to get that far :-) so that makes me feel better I did that right, but  when you click OK, it asks for an "Account" and I wasn't sure what to pick.  What Account should this go with?

Thank you again!

Highlighted
QuickBooks Team

Sales Tax in Florida

Hello everyone.

 

Happy to know that the steps provided by my colleague above were able to fix your concern.

 

Please know that our doors are always open here in the Community. Don't hesitate to add a post if you have any other QuickBooks concerns, I'm always here to help. Wishing you the best!

Highlighted
Level 1

Sales Tax in Florida

On the last step when you click OK, it asks for an "Account" what Account should this go with?

Also, we did this on an invoice and it is showing up on our sales tax liability for January but we pay on cash basis so it shouldn't be there because they haven't paid the invoice yet, how can we change this so it shows once it is paid on the sales tax liability?

Thank you so much!

Highlighted
Anonymous
Not applicable

Sales Tax in Florida

Hello, radley.

 

You’ll need to consult your accountant on which account to choose when setting up the item. Moreover, your Sales Tax Liability report could have been set to Accrual basis. You can change it to cash so it’ll only show paid invoices. Just select the Cash radio button on the upper left part of the report.

 

Please don’t be hesitant to reach us again if you anything else.

Highlighted
Level 1

Sales Tax in Florida

Good afternoon, I am having the same problem.  Which account did you go with?  Thank you

Highlighted
Level 1

Sales Tax in Florida

I have an issue with the Sales Tax Liability, my report is not showing the Multiple taxes for IRS, so my total sales is off.  Do you guys have any idea what could be wrong?

Highlighted
Level 1

Sales Tax in Florida

Hello,

 

I'm having an issue with the Sales Tax Liability report, the Total sales is off, I'm not seeing the Multiple taxes for IRS, that negates the amount from the total sales.  Do you have any suggestions?

Highlighted
QuickBooks Team

Sales Tax in Florida

Hey there, @henryb.

 

I'm happy to assist you with your sales tax liability report. 

 

It sounds like you may have a broken report. In these cases, we always recommend creating a new report. For example, if you're using a memorized report over some time, they don't present the correct data, which is why we refer to it as a broken report. 

 

However, if you have built a new report and the information is still incorrect, you may have your sales tax set up incorrectly. 

 

Here's how to set up sales tax:

 

  1. Go to the Edit menu, then select Preferences.
  2. On the Preferences window, select Sales Tax then go to the Company Preferences tab.
  3. Select Yes to turn on sales tax.
  4. Set up the sales tax items or sales tax groups for each county, district, city, etc. where you collect sales tax. Click Add sales tax item to do this.

     5. Assign sales tax codes. Sales tax codes help you track taxable and non-taxable sales or customers. Setting up and assigning the correct sales tax code allows you to run a report that divides the total taxable and non-taxable sales. When you turn on sales tax in QuickBooks, two tax codes create automatically: TAX (taxable) and NON (non-taxable). TAX is for items and customers that you need to collect tax. NON is for items and customers that are exempt from tax, such as non-profit organizations, out-of-state sales, or items that your customers will resell.

  6. Set the Sales tax basis (Accrual or Cash). Take into account your company's accounting preference.

  7. Set up your preference for paying the sales tax (Monthly, Quarterly, Annually).

  8. Select OK.

 

If you have further questions or concerns, please feel free to reach back out. Thank you, and have a great day!

Highlighted
Level 1

Sales Tax in Florida

Hello Tori,

 

I'm using the default Sales Tax Liability under Vendors & Payables.  I was with support and they were able to reproduce the issue, I was supposed to get a call today at 10am from second level support bu no one has called.

 

In south florida we have a surge charge on the first 5000.00 on an invoice. So if you have an invoice at 6% and the first line item is $5000 and you make the second line the 1% tax.  When you run the sales tax liability the report is correct, it shows the 5000.00 at 6% the $5000.00 at 1% and a third line that removes $5000.00 making the total sales $5000.00 But if the invoice is $6000.00 and we add a third line of $1000.00 and run the report, we get 6% Total Sales is $6000.00 which is correct, %5000.00 at 1% and the third line is no longer in the report.  So Total sales shows $11,000.00 which is incorrect.  The tax calculations are all correct it's just the report not removing the duplicate tax burden between the surge and standard tax.

 

I'm using quickbooks 2019 for MAC Desktop R7

 

Thanks,

 

Henry

Highlighted
QuickBooks Team

Sales Tax in Florida

Good afternoon, @henryb.

 

Thank you for giving us an update on your issue. I want to ensure you get the support you need.

 

Since Desktop for Mac is a more advanced program, there are a few questions I would like to ask to get a better understanding of your issue:

  • What Product/Service are you using on the 1% line in your invoice?
  • Which report are you running that shows this burden?

Your answers will help me determine the best solution for you. However, if you keep hitting a bump in the road, feel free to contact our Desktop Mac Support Team for further assistance. Just make sure you filter the page for Mac.

 

Please follow up with me if you need additional assistance. I'll keep an eye out for your response.

Highlighted
Level 1

Sales Tax in Florida

Are you using "sales tax payable" as the account? As i am now trying to set this up.

Highlighted
Level 1

Sales Tax in Florida

What a convoluted MESS that is.   I expected there to be a way to do all this nonsense automatically. I don't want to have to enter all this on every single invoice... I might as well just make out invoices by hand if I have to do all that

Need to get in touch?

Contact us