Are you a small business owner struggling with tax preparation? Do you find yourself drowning in a sea of paperwork and financial statements? You’re not alone. Tax preparation can be a daunting task, especially if you’re not familiar with the process.
Filing your own taxes can be nerve-racking, especially when it is last minute, and you’re still figuring out how to put together all your receipts, invoices, bills, and summarize your profit and loss statements of the financial year.
Every small business owner who is not taking the services of a CPA must know what all documents will be required to file taxes accurately this tax season.
But, if you’re a QuickBooks user, you can use the Accountant and Tax Reports to help you identify your accounting and financial activity throughout the year. It helps you track down the transactions better and file with precision.
Fortunately, QuickBooks has made it easier for small business owners to file their taxes accurately. In this article, we cover all the essential QuickBooks reports you need for tax preparation, and how they can simplify the process.
Table of Contents
How do I get tax reports from QuickBooks?
Let’s find out the QuickBooks reports that are required to file taxes:
1. QuickBooks Company and Financial Reports
QuickBooks accounting software can be used to track the company’s financial position using the Company and Financial Reports, which can turn out to be very helpful during the tax season.
Profit and Loss Reports
Use QuickBooks Profit and Loss Reports to get an overview of the business’s profitability over a given time frame. This information can make your tax filing simpler.
Moreover, using the Profit and Loss Standard report, you’ll be able to find out if your business was able to make money over the course of time or not. The Profit and Loss Detail Report also lists all the transactions over the selected period so you can determine your expenses and revenues.
But, most importantly, the Profit and Loss Year-to-Date report lets you compare the income and expenses to the prior year during the same time period.
Income and Expenses
Use the QuickBooks Income and Expenses Report to track down your firm’s gross profit/loss or income/expense over a specific period. The Income by Customer and Vendor Summary will help you track down the gross profit and total expenditure from each customer and vendor, respectively, for an efficient tax filing experience.
Not only that, if you select the Detailed Report, you’ll be able to track the transactions for each customer or vendor, which will give you the largest source of income and expense at once.
2. QuickBooks Sales Reports
Bills and sales processes are a major part of the tax filing process. The QuickBooks Sales Reports can be used to give you better insights into your invoices, sales by customers, and sales by representatives.
You can run the Sales by Customer and Sales by Vendors Reports to review the sales tax payable generated during the fiscal year as QuickBooks keeps an accurate track of the products purchased or sold. This helps you monitor, calculate, and remit the sales tax due.
3. QuickBooks Vendors and Payables
With the QuickBooks Vendors and Payables report, you get the summary regarding your sales taxes collected during the period and how much your business owes your tax agencies.
Sales Tax Liability
This report shows the total sales tax balance that your firm owes. It includes the total taxable/ non-taxable sales, tax rate, collected tax, and sales tax payable.
Sales Tax Revenue
This report is a summary of the sales tax that you have paid from the taxable sales during the selected time frame.
This report consists of the summary of the tax amount that was charged to each customer along with the Customer name, location, TIN No., Taxable amount, and more.
4. QuickBooks Employee and Payroll
Reports are vital for human resources and payroll employees for verifying and tracking expenses. You can use this report to gather the company’s tax filings, cross-check financial data, employee leaves and vacations, payroll details, and more.
Recommended Reading: How to Manage Payroll for Your Small Business?
The following reports can help to file your tax forms, employee management, and wages management:
Payroll Tax Liability
This report comprises of all the payroll taxes withheld, due, and paid for individual company employees. It summarizes everything which has already been paid for and what needs to be paid for all employees.
Payroll Tax Payment
In the Payroll Tax Payment report, you can see all the payroll tax payments for the selected time period for better tax filing.
Payroll Tax and Wage Summary
The tax and wage summary report shows your employee’s taxable wages and the withheld taxes from those wages. With this, you can find the information subject to state, local, or federal withholding.
Workers Comp is a kind of accident insurance paid by employers without making any payroll deductions from the employees’ salaries. It shows the compensation rate to be paid to every eligible employee.
Total Payroll Cost
This report calculates all year-to-date costs associated with your employees’ payments, including total, net, and gross pay and taxes.
This report displays the total calculations made by the company and employees towards their retirement plan.
5. QuickBooks Budgets and Forecasts
QuickBooks budgets and forecasting tools help you make smart business decisions by reviewing the prior year’s fiscal report data and setting up budgets and forecasts for the coming year for efficient tax filing.
Budget reports will show you the budgeted revenues and expenses for the fiscal year. Compare the company’s budgeted versus actual revenues and expenses with the Budget vs. Actual Report to find out if you’re over or under budget and compare your company’s Profit and Loss Budget Performance.
Moreover, the Forecasts Overview Report will help you predict future business revenue and cash flow. Use the Forecast vs. Actual Report to compare the budgeted versus actual revenue and expenses to the projected amounts for a better tax filing experience.
6. QuickBooks Service Tax Report
Service Tax needs to be paid at most of the transactions. QuickBooks provides a platform to record and create different Service Tax reports.
Here are some of them:
Service Tax Abatement Report
This report provides a list of all the transactions on which abatement is calculated. It shows the exact percentage and amount that has been calculated.
Service Tax Reverse Charge
This report shows all the transactions for which reverse charge is calculated in service tax. It shows the percentage and amount of the taxable amount.
With QuickBooks reporting, you can put all your company data to use. One of the major benefits of reporting is that you can export all the data relatively easily into excel or any other spreadsheets.
QuickBooks can help you track all your data for tax filing processes. Moreover, you can customize these reports or create as per your convenience to meet your business requirements.
Q: Why do I need QuickBooks reports for taxes?
QuickBooks reports can provide you with valuable information that you need to prepare your tax returns. By generating reports such as Profit and Loss, Balance Sheet, and Sales Tax Liability, you can easily gather the necessary data to complete your tax forms accurately.
Q: What specific reports should I generate in QuickBooks for my taxes?
The reports you generate will depend on the type of tax you are filing, and the specific information required for your business. However, some commonly used reports include Profit and Loss, Balance Sheet, Sales Tax Liability, and Payroll Tax Liability.
Q: How do I generate these reports in QuickBooks?
To generate reports in QuickBooks, go to the Reports tab on the left-hand menu, and then select the report you want to run. You can customize the report by selecting the date range and other options before running it.
Q: Are there any other reports I should generate in QuickBooks for tax purposes?
Depending on your business, you may also want to generate reports such as Accounts Receivable Aging, Accounts Payable Aging, and Inventory Valuation Summary. These reports can provide additional information that may be necessary for your tax returns.
Q: Can I use QuickBooks reports as supporting documents for my tax returns?
Yes, you can use QuickBooks reports as supporting documents for your tax returns. It is recommended that you keep a copy of these reports for your records and provide them to your tax preparer if necessary.
Q: Can QuickBooks help me file my taxes?
While QuickBooks can provide you with the information you need to prepare your tax returns, it is not a tax preparation software. You will still need to file your taxes separately through a tax preparation software or with the help of a tax professional.
Have any questions? Please contact a solutions consultant at 855-375-4955.
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