Why is there a negative taxable sales amount on this report? What do they mean by “multiple taxes for…”?
You’ll see something similar in the sales tax revenue summary.
Another annoying issue here is that if you click on that line to drill down to the supporting information, it shows you a POSITIVE value for sales, not that negative value?
It’s OK!
This does NOT represent a problem, and it is NOT reflecting some sort of adjustment to your reportable tax liability. QuickBooks adds this line if you are using sales tax group items in your invoices.
I have created a “Yolo County Sales Tax” item as shown below, which combines my California Sales Tax base rate together with the City of Davis incremental tax rate, and then I used this in some invoices.
Side Note – this is just an example, the actual sales tax rates might not be accurate.
As you can see, there isn’t a line in the sales tax liability report for my Yolo County Sales Tax – instead, the two component items are listed. That means that the $4500 that went to Yolo County Sales Tax is listed TWO times on the report in the “Total Sales” and “Taxable Sales” columns. The taxable amount is reportable for BOTH items, as you need to report the total taxable sales in each jurisdiction. However, to be able to show an accurate total, QuickBooks adds that negative value in the “multiple taxes…” line.
So, ignore that negative line in the Sales Tax Liability report. It is just something inserted to make the totals work out correctly.
Note that you don’t run into this if you don’t use sales tax group items. For example, I have a “Contra Costa” sales tax item in that same report, which includes the state and county sales tax all in one sales tax item, rather than using a sales tax group. For this situation QuickBooks doesn’t have to make any sort of adjustment, which keeps things cleaner and easier to understand. In many tax jurisdictions all you have to report is the total taxable amount for the entire state (the Total State Board of Equalization figure in my example), and then the total taxable amount for each district. So, even though Contra Costa is a combination of the county and state rates, I just need one sales tax item to report the correct amounts in my state report. That works for California (for example) – you have to look at the regulations and reporting requirements for your own situation.