QuickBooks 2011: The Missing Manual

Paying Sales Tax

Sales tax can be complicated, particularly in states where the number of tax authorities has exploded. You might have to pay sales taxes to several agencies, each with its own rules about when and how much. QuickBooks sales tax features can’t eliminate this drudgery, but they can help you pay the right tax authorities the right amounts at the right time—and that’s something to be thankful for.

After governmental paperwork, the chief aggravation of sales tax is that setting it up spans several areas of QuickBooks. If you’re new at collecting sales tax for your products, make sure you’ve completed the tasks in the following list so you’re collecting and tracking sales taxes properly. Only then can you pay the sales taxes you owe.

Here’s the sales tax setup you have to do:

• Sales tax preferences. If you’re liable for sales tax, be sure to turn on QuickBooks’ sales tax feature, as described in the next section.

• Customer records. When you create a customer in the Customer:Job List, you can assign tax codes and tax items to the customer’s record (Entering payment information). If you do, QuickBooks automatically calculates and applies the correct sales tax items to taxable sales on the customer’s invoices.

• Items. When you create items in your Item List, you can specify whether they’re taxable or not (Inventory Part Fields). That way, when you add these items to invoices or other sales forms, QuickBooks automatically applies the correct tax status. (See pages Setting Up Sales ...