Sales Tax

Hi, I am new to quicken software and I looking for some assistance on sale tax setup.
I have downloaded credit card expenses and I would like the expense to separate our sales taxes. What is the easiest way to set this up?

I have also moved these expenses from the credit card account to the business bills account hoping it would give the option to take the total and assume sales tax based on the total amount.

Even the sales tax account that I set up and pull tax report does not recognize this tax account for the report.

Other than manually inputting every expense over again through the business bill account, is there another option.

Thanks.
R

Comments

  • Tom Young
    Tom Young SuperUser ✭✭✭✭✭
    "I have downloaded credit card expenses and I would like the expense to separate our sales taxes. What is the easiest way to set this up?"
    You create a split entry for each transaction and pull out the sales tax on a separate line of the split with its own Category.  The downloaded amount simply comes as a single dollar amount to you, and you have to analyze how that lump sum number gets split up into Categories that you want to track.  So when my wife hands me the grocery store receipt she - hopefully - has noted how each line item on the receipt gets Categorized and I split that single dollar figure accordingly.  You'd simply do the same thing, memorizing that transaction so that the line items - Categories - are still there the next time you use that vendor.
    "I have also moved these expenses from the credit card account to the business bills account hoping it would give the option to take the total and assume sales tax based on the total amount."
    I'm not sure I'm following what you are doing here.  If you move (transfer) a transaction out of the credit card Account to another Account on your balance sheet, that's going to leave the balance in the credit card Account misstated. If you're incurring both personal and business expenses on the same credit card, you need to Categorize those expense as "business" expenses (Categories), not move the transaction to a different Account.  When you Categorize a particular transaction as a "business" expense that's the time to capture the sales taxes, if any, as part of a split. 
    "Even the sales tax account that I set up and pull tax report does not recognize this tax account for the report. "
    Maybe if you could explain what you're trying to achieve it would make it easier to help you.  You don't associate, per se, an Account to an income tax line item.  If you want to accumulate sales taxes for possible inclusion on a Schedule A for you income tax return, then you'd need to create a sales taxes Category and associate that Category with "Schedule A: Sales Tax Paid" under the Tax Reporting tab of that Category.
    "Other than manually inputting every expense over again through the business bill account, is there another option."
    That business bill account is puzzling me.  But if you're using it to somehow accumulate costs where you know there's an element of "sales tax" in that cost, a roundhouse guess could by made by taking the balance in that business bill Account, dividing it by 1 + sales tax rate, then subtracting the resulting figure from the balance in that Account.  That would give you an estimate of sales taxes paid.
  • RNCSI
    RNCSI Member
    Thanks for responding. If you click business (header) and go into business tools, you can set up sales tax rates and tax accounts. Then if you setup business bills - the system is supposed to calculate the sales tax on all transactions. You are also able to setup reimbursable expenses for sales tax (which I have not to figured how to do). If you add a new account: business payable then the system creates business bills accounts which are (vendor invoices expenses) and you are to add vendors to each of these business bills expense types.

    Under the credit card, I have separated expenses from personal and business but I have not split the sales expenses.

    Under the business header, there is a section called reports. When you select HST reports it should summarize sales tax based on sales invoices and purchases. But if you split the expenses under credit card transactions, the sales expenses do not get picked up under this business report.

    This is why I am trying to figure out how to get this to work properly. Plus I don't want to go back with every credit card transaction and split out sales expenses manually. I was hoping the system will calculate the sales expense on its own if the expense type is flagged as sales tax reimbursable.

    R
  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    Simply put, NO "split" info is downloaded for your banks/cards/etc.  Your Financial institution doesn't know what the split info should be ... they only know the When, Who, and Total Amount.
    SO, you need to input the Sales Tax info yourself ... on every transaction.
    I've been doing this for years, because my state doesn't have a State Income Tax ... thus I can deduct my Sales Taxes on my Federal Income Tax return. (Actually anyone can, but you can only deduct ONE of Income Tax vs. Sales Tax ... and if your state has an income tax it virtually certain to be higher than your sales tax).
    It's also worth doing this split because my experience, over 20+ years, is that the ACTUAL sales tax that I pay is 2-3 times higher than the "IRS Estimated Sales Tax" ...so at least for me it's well worth the effort.  YMMV.
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
This discussion has been closed.