Better categorizing sales tax

Quicken needs a better way to deal with Sales Tax. If I split a purchase into its category & sales tax, the spending reported on the category is reduced.

E.g. I paid $107 dollars for an Houshold appliance - $100 + $7 tax. Expense report by category only shows $100 for Household Appliances - the $7 goes to schedule A tax line.

If instead, I add a Sales Tax tag, I can get a report by Tag at tax time. But the amounts aren't automatically credited to Schedule A and it's not noted as a Tax expense. So importing to tax software needs manual help.

Similarly, if I buy a car, the cost of the asset includes what was paid in Sales tax, but the Sales tax is also a significant item for Schedule A. Currently, the total spent on the car is reduced if this is categorized as Sales Tax - or if tagged instead, reaquires manual action when income taxes are computed.

One solution would be to be able to assign a tax line category to tags...

To avoid inflating total expenses, total expenses needs to reflect this - perhaps an offset line such as "tagged expenses", in this example under Household appliances.

The only other alternative is to create a sub-category for Sales tag under every other (taxable) category. This is unworkable (dozens of extra categories) - and what Tags were supposed to address.
1
1 votes

New · Last Updated

Comments

  • splasher
    splasher SuperUser ✭✭✭✭✭
    If I want to know what a car is costing me, I create a tag for that car and apply it to every transaction or split line that is associated with that car, so in your car example, the purchase price, tax (sales and excise), registration, fuel and repairs will all have that tag.
    That way I know what the car is costing me by category and things that need to be separated by tax line are properly annotated.
    Same tactic can be applied to other items that are taxed.
    Your suggestion means that a transaction could have conflicting tax lines based on the category and tag if both can have a tax line assigned.

    -splasher  using Q continuously since 1996 -  Subscription Quicken  -  Win11
    -Questions? Check out the  Quicken Windows FAQ list
  • WilliamK
    WilliamK Member
    edited January 6
    [Removed - Off Topic]
  • Rocket J Squirrel
    Rocket J Squirrel SuperUser ✭✭✭✭✭
    quickastl said:
    Quicken needs a better way to deal with Sales Tax. If I split a purchase into its category & sales tax, the spending reported on the category is reduced.

    E.g. I paid $107 dollars for an Houshold appliance - $100 + $7 tax. Expense report by category only shows $100 for Household Appliances - the $7 goes to schedule A tax line.
    Why do you think this is wrong? It seems right to me and is the way I do it. The $100 paid for the appliance and the $7 went to tax. Why do you wan to categorize that differently?
    Quicken user since version 2 for DOS, now using QWin Premier Subscription (US) on Win10 Pro.