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Sales Tax and Quick Books Pro

Joel_3 Member Posts: 166
Ok, We use Quick Books Pro 2000 for our accounting. We do not pay sales tax when we buy equipment/supplies, etc. We have to charge the customers. This is not a problem on service items, however, when it comes to installation work - it becomes a problem. The way i do it in quick book (qb) does it is that if you have a job for say $10,000 - $4,750 labor, and $5000 materials and $250 sales tax i enter the entire amount. The reason i do this, is because if i get a deposit of say $1,000, when i enter it into quickbooks, and apply it, it will take the $1,000 and apply a % of it to sales tax. So, when i get a deposit, i have to enter the whole entire amount into quickbooks, in order to keep the sales tax correct.

Herein lies the problem. If i am doing say a $50,000 job, and i enter the entire amount in, then quickbooks says i am owed $50,000. So if i am trying to do a profit and loss, on accrual basis, it will show that im owed a riduculous amount of $. This really stinks too, if i am trying to do a profit and loss comparison with the year before.

Does anyone know how to do this a differnet way? I have tried using estimates, but you still have to differentiate the materials and labor, and then it wants you do use a percentage of the estimate, or something like that . Anyways, i need help with this - so if anyone has any ideas, it would REALLY be appreciated. THank you very much -

Erika and Joel Boucher
[email protected]

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  • Chris Brown
    Chris Brown Member Posts: 17
    have you tried

    using the feature in QB pro that lets you use progress billing, or invoicing?? you can enter the entire contract amount and then use the progress billing feature to bill them, eliminating the tax issue! and can be used for deposites also, just part of the billing process.

    I use it all the time, and works fine for me.

    If you need help with setting this up, I would find a QB advisor. go into the section "business resources" and click on "find an advisor". there will be advisors listed for your area, and some of them are VERY good, found my new bookeeper and acountant that way.

    good luck


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