Why You Should Reconcile Accounts Before Filing Sales Tax
Ask the Accountant…
Question: I filed my sales tax last week with the numbers in the QuickBooks sales tax liability report. When I ran the report again this week, the numbers had changed. What’s going on?
Answer: Likely, you had not reconciled your checking account(s) before running the first sales tax report. When you reconcile, you discover and add any transactions that you had not yet entered into your accounting system. If your sales tax report changed, you probably found and entered customer deposits of orders subject to sales tax that had not been entered before you ran the first report.
In any accounting system, you should always reconcile your bank and credit card accounts before running reports you will use to file taxes of any kind.
Please email your questions to Harriet at Ask The Accountant.
QuickBooks Premier and Enterprise can be modified to better serve ad specialty distributors. Harriet Gatter is a QuickBooks ProAdvisor, a former accounting professor and a former ad specialty distributor. She advises ad specialty distributors to use QuickBooks Premier and Enterprise, often in conjunction with other industry-specific software, to manage the complexities of the ad specialty business, with the results being time saved, errors eliminated and an overall accurate accounting of your business. Contact her at firstname.lastname@example.org.