 QuickBooks Online 2024, pay sales tax, get ready and some coffee because we're sketching out the bookkeeping process outline with QuickBooks Online 2024. Here we are in our Get Great Guitars 2024 QuickBooks Online sample company file we set up in a prior presentation. Go into the reports on the left hand side like we do every time and we're going to close the hamburger. Right click on the balance sheet within the favorites and open link in a new tab. Right click on the profit and loss open link in a new tab and the same with the trustee TB trial balance. Let's go to that middle tab we opened up close up the hamburger on the balance sheet and change the range. 010124 tab 022824 tab seen it in a month by month side by side running it tabbing to the right closing the boogie hand boogie that is and changing the range in 010124 tab 022824 tab month by month breakout and refresh and then tabbing to the right repeating once again the date range 010124 tab 022824 tab month by month side by side running it let's go back to the balance sheet to consider the next step we're going to be taking here that being the pain off of the sales tax remembering that the double entry accounting system itself is universal. It's basically like math so it's going to work no matter what place you're located in however you'll be dealing with different currencies but the concept will be the same. Things will differ where laws happen because laws are going to be specific to particular areas and with bookkeeping the most disruptive laws are of course the tax laws. So we're here I'm thinking about sales tax which is a type of usage tax note also that there's no new taxes under the sun in essence governments have come up with very invent all the inventive ways of taxing really what we have at this point in time is just a combination of those types of taxes. That are then going to be applied in different locations so sales tax kind of usage type of tax so there's going to be a tax applied. At the point of sale and basically the idea is that the government is going to make the employer their tax collector trying to pretend as though the tax isn't on the employer even though they're the ones that have to charge for it. But rather the taxes on the purchase that the purchaser the people purchasing the goods in service now from an economic standpoint you can argue who the taxes on because of course again the employers the one has to increase their their sales price and collect the tax and what not but that's the general idea. So what's going to happen then as we make sales we're going to be increasing the liability accounts as we have seen as we've been entering the sales forms throughout our practice problem here are the liability accounts for the sales tax that we owe. So the general idea would be that if I hit the plus button up top whenever we sell something with an invoice form or sales form those are the sales forms. Meaning if you use some other form like a bank deposit that might cause problems within the calculation of the sales tax because they're going to be calculated with the sales forms of the invoice. And the sales receipts when we enter those we're going to be charging sales tax the sales tax isn't going to go to an income account even though we're charging for it and collecting on it but rather to a liability account. So let's give a quick recap of the setup process for the sales tax there's basically three things that need to happen to get the sales tax up and running and we're looking from the United States standpoint here one you got to basically get the sales tax turned on. And then to you need to determine which items are going to be assigned sales tax using your inventory items in service items. And then three if there are any customers that are exempt from sales tax even though the item if it was sold to a different customer would be subject to sales tax. You can then adjust the customers to deal with with that scenario. So let's quick recap first tab. Let's go down and say the sales tax was set up down here in the taxes area. We have the first tab being the sales tax. So within the sales tax tab we based it on our location. If you only have one store location the sales tax is fairly easy because QuickBooks can determine the address of the store and help you hopefully to set up the sales tax charging the proper rates. If you're in an online type of situation you sell on Amazon or you sell on Shopify or things like that it gets a lot more complicated both in terms of the question of who is responsible for the sales tax. For example Amazon might be the one that has to carry the burden of charging sales tax in certain situations. Whereas if it's your website like a Shopify store you might have to do more of the work on making sure that you're in compliance with the sales tax. Yourself. So we have to keep those types of things in mind. We're not going to go into that in detail here. They can have a whole other course on sales tax if it's going across state lines and whatnot. But we have a course on Shopify store recording in general in a future course or section if you want to look at that in more detail. But in any case once we set up the sales tax we have our screen here. We could set basically the default taxing. We have the sales tax setting. If I go into the sales tax setting you'll recall that we have our agencies up top. These are the people that we're going to pay the money to because they forced us to collect on their behalf. And then we have the this was the custom rate for the generic problem that we put together down below. Remembering in the in the United States there's a federal income tax. That's the major way that the federal government gets paid in order to do their job of protecting and the military and that kind of thing. Although they spend the money on all other kinds of crazy stuff. But and then on the state side of things the states decide how they're going to collect taxes which often includes a sales tax system. So that's why it's a state and you might have a local state and local sales tax that will add up and you can have one charge. But you might be paying two different agencies for the one charge. Okay. So we set that up. And then we'll be we have the sales tax we got the economic nexus which.