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Texas Sales Tax multiple tax rates

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  • Texas Sales Tax multiple tax rates

    I am using QuickBooks 2018 Accountant Desktop.

    For Texas, some of my services provided will be taxed at 100% of the invoiced amount. Other services will be taxed at 80% of the invoiced amount.

    I import invoices using Transaction Pro Importer 7.0. I have more than 50 invoices I import at this time. I have anywhere between 1 to 20+ line items on each invoice. Invoicing is done on a monthly bases.

    Is it possible to import invoices with both 100% and 80% of the invoiced amount into QuickBooks and have the sales tax calculated? Or will I need to import the sales tax amounts?

    We are a growing company and hand entering invoices is not an option.

  • #2
    first you need a sales tax rate for zero %, and another for a rate of 0.066 (6.6%)

    I can not help with pro importer and how to set this up, but the import needs to result in an invoice ....

    The customer sales tax code at the bottom of the detail area has to be set to the zero % rate item

    then list the 80% tax able items, followed by a sub total, and then the reduced rate sales tax item at 0.066

    then list the items that are subject to normal sales tax, a sub total item, and then the normal 8.25% sales tax item


    Al that is well and good for local sales tax, Texas is origin based sales tax, with one exception. And that is services performed outside the home city/county. Then the issue becomes even more complicated, if you provide a service to a location in the county but outside the city, you do not collect city sales tax, just the county and state

    so you are going to need several sales tax groups as the location demands.

    You need to check with the transaction pro importer people about importing a flat amount into sales tax payable. I know you can not do that using an iif import. And if you do that, you still have the issue of reporting sales numbers to the state by the county, city and state.

    Texas allows the business to decide whether to pay sales tax on a cash basis or accrual basis (most state require accrual basis). If you choose to pay on accrual basis then you might check into one of the tax services, avalar or tax jar. They only do accrual based sales tax. BUT, again I do not know if they can handle the destination based sales tax rates by service, where some are at a reduced rate.


    • #3
      Rustler, thank you. Yes, Texas is the worst for sales tax. As of right now, I will not have to collect sales tax for other states. This could change at any moment (thank you Supreme Court). I will figure it out. You have pointed me in the direction I need to go.


      • #4
        The Texas state sales and use tax rate is 6.25 percent, but local taxing jurisdictions (cities, counties, special-purpose districts and transit authorities) also may impose sales and use tax up to 2 percent for a total maximum combined rate of 8.25 percent.