By: Val Barschaw

© 2010 All rights reserved.

Tracking Use Tax in QuickBooks®

Val BarschawPresenter

Actual photo from our office location in Cle Elum, WA

Tracking Use Tax in QuickBooks®

Tracking Use Tax in QuickBooks®What is Use tax?

Use tax is: a tax on the use of goods or certain services in most States, when State sales tax has not been paid.

When you make a retail purchase, you usually pay sales tax to the seller, who in turn pays it to the State. However, there are instances when sales tax is not paid on purchases, and in many of these situations, use tax is due. For example, the law in Washington State states that “Goods or certain services used in this state are subject to either sales or use tax unless specifically exempted.”

There is no one rule that applies to all states, so be sure you are familiar with the rules in your particular location.

Tracking Use Tax in QuickBooks®

Tracking Use Tax in QuickBooks® Questions so far?

Tracking Use Tax in QuickBooks® STEP #1: Prepare

Tracking Use Tax in QuickBooks® STEP 2: Record it as it happens

Tracking Use Tax in QuickBooks® STEP 3: Generate/Review Report

Tracking Use Tax in QuickBooks® STEP 4: Adjust Taxes Due

Tracking Use Tax in QuickBooks® STEP 5: Render Payment

BONUS: Tracking Tax CreditFive Step Process EXAMPLE for WA State

#1 Prepare

#2 Enter as it happens

#3 Generate report

#4 Adjust tax payment

#5 Render payment

= Tax at Source

= Tax District & Price in Memo

= Sort by Memo

= Decrease taxes owed

BONUS: Tracking Tax Credit

Tracking Use Tax in QuickBooks®

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Val Barschaw

www.bookkeepingmadefun.com