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4 Comments
Chris C on July 13, 2019 at 7:52 pm
I’m a little uncertain about the sales tax part. For example, I have an order that has tax listed in the order details (item price $17.99 tax $1.33 total $19.32). It was for a sale to someone in NY and I’m in NE. When I look at the all statements payment report, I can see the sales tax of $1.33 and then a MFT for -$1.33. The question I have is what do I do on my invoice: 1) Only add taxes if it’s a sale to someone in NE 2) Do I have to verify if there’s an MFT and is so leave the invoice tax set at 0 3) Add taxes for all orders that have tax but no MFT 4) Some other option I’m not thinking of. 🙂
You will only add sales tax to the invoices for the states you are registered with to collect and remit tax. You are not responsible for MFT. That is a tax that is required to be remitted by Marketplace Facilitators like Amazon.
Since Amazon remits the sales tax directly to the states that require it, you will not receive it from Amazon. Therefore, it should not be added to the invoice.
Remember the invoice total is added to Accounts Receivable. When the payment statement is posted the total received should match the total of the invoice. If you have added the MFT to the invoice, the total payment will not match because Amazon will not send you the tax funds. I realize it sounds like I am talking in circles. I want you to understand the reasoning, not just the rules.
Vicki, I have enjoyed and learned a lot from your quickbooks pro courses, thank you. One question: If quickbooks calculates sales tax for an invoice, but that amount is different than amazon calculates on the invoice by % (may be just rounding error), then when I Customer: Receive payment, the posting worksheet total A/R amount will be different than sum of applied invoices and on receive payments shows as overpaid or underpaid by a few cents. What is the best way to handle this difference? Thank you John Kendrick mjkcourage@gmail.com
When you create the invoice and the tax is off, you can go ahead and do a Sales Tax Adjustment on the Invoice screen. There is a button at the top of the screen. If you did not do that on the invoice and now want to do it on the Customer: Receive Payments, you can still do it. Go to Module 6 Unit 5 Posting AR & AP Transaction video. Look about 5 minutes into the video for instructions. Hope that helps.
I’m a little uncertain about the sales tax part. For example, I have an order that has tax listed in the order details (item price $17.99 tax $1.33 total $19.32). It was for a sale to someone in NY and I’m in NE. When I look at the all statements payment report, I can see the sales tax of $1.33 and then a MFT for -$1.33. The question I have is what do I do on my invoice:
1) Only add taxes if it’s a sale to someone in NE
2) Do I have to verify if there’s an MFT and is so leave the invoice tax set at 0
3) Add taxes for all orders that have tax but no MFT
4) Some other option I’m not thinking of. 🙂
Hi Chris,
You will only add sales tax to the invoices for the states you are registered with to collect and remit tax. You are not responsible for MFT. That is a tax that is required to be remitted by Marketplace Facilitators like Amazon.
Since Amazon remits the sales tax directly to the states that require it, you will not receive it from Amazon. Therefore, it should not be added to the invoice.
Remember the invoice total is added to Accounts Receivable. When the payment statement is posted the total received should match the total of the invoice. If you have added the MFT to the invoice, the total payment will not match because Amazon will not send you the tax funds. I realize it sounds like I am talking in circles. I want you to understand the reasoning, not just the rules.
Vicki, I have enjoyed and learned a lot from your quickbooks pro courses, thank you.
One question: If quickbooks calculates sales tax for an invoice, but that amount is different than amazon calculates on the invoice by % (may be just rounding error), then when I Customer: Receive payment, the posting worksheet total A/R amount will be different than sum of applied invoices and on receive payments shows as overpaid or underpaid by a few cents. What is the best way to handle this difference? Thank you
John Kendrick mjkcourage@gmail.com
When you create the invoice and the tax is off, you can go ahead and do a Sales Tax Adjustment on the Invoice screen. There is a button at the top of the screen. If you did not do that on the invoice and now want to do it on the Customer: Receive Payments, you can still do it. Go to Module 6 Unit 5 Posting AR & AP Transaction video. Look about 5 minutes into the video for instructions. Hope that helps.