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Track usage taxes

How to track use (or usage) taxes in QuickBooks Desktop.

Detailed Instructions

Use (or usage) taxes are imposed on purchases shipped to you from a different state than the one in which you have your business. Generally, this tax only applies to states that already have a sales tax. Its purpose is to equalize the tax burden when buying from in-state or out-of-state vendors.

To calculate use tax owed, you will first want to label your out-of-state vendors, and then run a report to see how much has been purchased from these vendors:

  1. Choose Lists > Other Lists > Vendor Types.
  2. In the Vendor Type List, click the New button.
  3. Enter Outstate (or a similar name) in the Vendor Type field, and then click OK.
  4. Choose Lists > Vendors.
  5. Click to select an out-of-state vendor, and then click the Edit button.
  6. In the Edit Vendor window, click the Additional Info tab.
  7. Click the Type drop-down list, select Outstate, and then click OK.
  8. Repeat steps 5 through 7 for each out-of-state vendor.
  9. For each use tax time period, run a transaction detail report:
    1. Choose Reports > Transaction Detail Report > By Account.
    2. Click the Filters button.
    3. Select Account from the Add Filter drop-down list, and then select Selected accounts from the Account drop-down list.
    4. Select the appropriate payment accounts (this will limit the report to monies paid out to vendors), and then click OK.
    5. Select Vendor Type from the Add Filter drop-down list, and then select the type you created in step 3 from the Vendor Type drop-down list.
    6. Click the Apply button.
  10. Multiply the report balance by the use tax percentage to find the use tax total owed to the tax vendor.

Note: If you require use tax and sales tax on a single check, you can enter the use tax information into the Sales Tax Payable register using the correct tax vendor, amount, and expense account. Then choose Pay Sales Tax from the QuickBooks Activities menu to pay both amounts.

KB ID# HOW12144
12/3/2016 3:38:24 AM
QYPPRDQBKSWS03 9138 Pro 2017 72b29a