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Level 2

We are in Houston and our Sales Tax obligation is 8.25% according to Texas Comptroller and QBO is only calculating 6.25% - HELP!

 
5 Comments
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Moderator

We are in Houston and our Sales Tax obligation is 8.25% according to Texas Comptroller and QBO is only calculating 6.25% - HELP!

Thanks for reaching out, @celeste1467.

 

I'm determined to figure this out and get you back to business. Our automated sales tax system bases calculations on addresses. By default, it will use the Company Address entered in your Account & Settings page. If you've entered a Ship To Address on a sales form, the calculation will then be based on that address. If you'd like to check the calculation breakdown, click the Sales tax link on the invoice or sales receipt. To know more about sales tax, please refer to this article: Set up and use Automated Sales Tax.

 

If the calculation is incorrect, you can manually override the tax amount for now. I also recommend calling our phone support to investigate this further.

 

If you have any other questions for me, feel free to send a reply my way. I'll be here to help. Have a wonderful day.

 

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Level 2

We are in Houston and our Sales Tax obligation is 8.25% according to Texas Comptroller and QBO is only calculating 6.25% - HELP!

Thank you for replying. I guess I will have to contact phone support tomorrow.  We are local shop and sale orignates at our shop.  We aren't shipping goods somewhere.  We pay three taxes to comptroller based on our shop address and this has been confirmed by the comptroller.  The address was put in correctly in QBO.  

We pay:

State Sales Tax at 6.25%

Houston MTA Tax at 1%

Houston City Tax at 1%

However, there isn't an option to add the Houston MTA and Houston City tax into QBO all of which is collected by the Texas Comptroller.  I've seen numerous other complaints of this online about QBO and I know everyone dealing with it was Texas.  I appreciate any guidance you can give.  I HATE this automated Sales Tax center as I've used the other one for years and never had an issue submitting my Texas Sales Tax.  Thanks again for any help.

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Level 15

We are in Houston and our Sales Tax obligation is 8.25% according to Texas Comptroller and QBO is only calculating 6.25% - HELP!


@Michael K wrote:

 Our automated sales tax system bases calculations on addresses. By default, it will use the Company Address entered in your Account & Settings page. 

 


And there in lies the problem, if a "shipping" address is entered - QBO auto sales tax does it wrong.

 

Texas is NOT destination based (unless you travel to make the sale)

 

You need to FIX your sales tax criteria, this is not the first time this has been brought up to someone who works for intuit during the last two years.

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Level 2

We are in Houston and our Sales Tax obligation is 8.25% according to Texas Comptroller and QBO is only calculating 6.25% - HELP!

Thank you for replying. How do I FIX my sales tax criteria?  I am not given an option to change that anywhere in the Sales Tax Center.  I don't enter a shipping address when I enter a customer invoice.  I just open a new invoice like I used to, I put in the customer name, enter the labor, parts, ect. and it is automatically calculating 6.25%, so I am having to manually override every single invoice.  Can you walk me through the steps to change my Sales Tax Criteria bc QBO isn't giving any areas I can change anything except the agency and it only gives pre-populated options like Texas Comptroller, but does not include Houston City and Houston MTA tax, so I do appreciate any guidance you can give on how to change whatever I need to change to calculate at 8.25%.  Thanks.

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QuickBooks Team

We are in Houston and our Sales Tax obligation is 8.25% according to Texas Comptroller and QBO is only calculating 6.25% - HELP!

I appreciate the complete details you've provided, @celeste1467 

 

The Ship To address in the invoice is one of the basis in the calculation of Sales Tax. 

Let's make sure to enter a Houston, Texas address as the Ship-To address in the invoice so it will accurately calculate your 8.25% sales tax. 

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If your company address is within Houston, there's no need to enter a Ship To address. The system will automatically calculate your sales tax. 

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However, if your company address is not set within Houston and you don't like entering Ship To address, just make sure to indicate in the invoice that the sales happen within Houston. By doing so, it will still calculate your Houston sales tax accurately.

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Lastly, if your company address and location of the sale is not set within Houston and you don't like to enter a Ship To address, you can manually override the sales tax calculation.

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From the invoice page, click on the See the Math link. Then, click on the Override this amount link. 

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I'd also recommend consulting with an accountant so you'll be guided in accurately overriding your sales tax in QuickBooks. You can refer to this article for more detailed steps: Override sales tax on transactions.

 

You may also read through these articles  to learn how QuickBooks Online automatically calculates sales tax:

Get back to us here if you have other questions. I'm always here to help.

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