QuickBooks is accounting software that allows you to manage and organize a wide range of accounting activities such as bookkeeping, the creation of financial statements, and much more.
In QuickBooks, accounts can be sorted into different categories according to their nature, i.e., assets, liabilities, income, and expenses. If there is a situation when you would like to see the information for a line item in QuickBooks, you will have to set up a separate account for that particular line item. Similarly, when you need to report financial information on a tax return, you must create an account to collect and report the required data.
In QuickBooks, if you want an expense account to be assigned to a tax line, you will have to create a new account. To do so, first, open the menu called “Chart of Accounts” and then click on the button labeled “Account.” After that, click on the “New” button. This will now open a menu where you can choose between multiple account types. Choose the “Expense” account option and then click on the button labeled “Continue.” You will be prompted to enter the name that will be used to identify your new account. You will then be given the option to make this account either a sub-account or the main account. After checking the appropriate box, you can click on the button labeled “Patent Account.” With this, you will have created the expense account that you will later assign to the tax line.
Once you are done with creating the expense account, you will be able to record information relevant to that account. For example, if you just created an expense account that relates to a particular utility, you can mention the name of the utility or the service provider, your unique customer number, and any relevant dates such as the billing dates. Different drop-down menus allow you to enter and sort the information pertinent to the expense account you just created.
Assigning the Expense Account
To assign the expense account, you first select the “Tax Line Mapping” menu in QuickBooks. Here, you will see a drop-down menu that will include multiple tax lines, allowing you to select and choose the one that you think is relevant to the expense account you created. Once you have selected the tax line, you will be given a list of expense accounts to choose from. Here, you can choose the account you want to assign to the tax line.
Alternatively, you might want to assign a preexisting account to a tax line. In QuickBooks, if you want to assign an expense account that exists beforehand, you first need to go to the “Chart of Accounts” menu. Once there, you can right-click the specific expense account you want to assign to a tax line. Once you see the right-click menu, choose the “Edit Account” option. Next, choose the option that allows you to change the “Tax Line Mapping” data. The drop-down menus you will see next can select the relevant tax line and tax form.