You're on the right track, GFMBookkeeping.
I'd be happy to help share how to handle the sales tax overpayment refund in QuickBooks Desktop (QBDT).
You can use a bank deposit and use the expense account used when you pay your taxes. Here's how:
- Go to the Banking menu on the top bar and choose the Make Deposit button.
- In the Payments to Deposit window, click OK.
- Choose the right bank account in the Deposited To window.
- Select a Date.
- Complete the information in the following fields:
- Received From - pick the agency's name where you overpaid.
- From Account - select Sales Tax Liability account since you overpaid the sales tax.
- Amount - enter the total amount you overpaid.
6. Once done, click Save and Close.
Additionally, I suggest seeking guidance from your accountant to ensure you make the correct sales tax adjustments in your Chart of Accounts.
You can always run your Sales Tax Liability report to review the taxes you owe and why you owe them. Just go to the Reports menu and choose Vendors & Payable, and select Sales Tax Liability.
Please consider checking these handy articles for additional information about handling sales tax: Process sales tax adjustment.
Let me know in the comments if you have other concerns about recording sales tax overpayments in QBDT. I'm always ready to help. Take care, and I wish you continued success.
