Did you know that QuickBooks has your back when it comes to simplifying your tax filing process? Well, it does, and it’s a game-changer.
QuickBooks, the versatile accounting software, is equipped with a set of powerful tax preparation reports that can help you if you prefer to take charge of your tax obligations independently. QuickBooks empowers small business owners to better understand their financial activities throughout the year.
We get it – filing taxes is a weighty responsibility especially when you are not a tax expert. That’s where QuickBooks steps in with the Accountant and Tax Reporting feature that tracks transactions and meticulously ensures precision in your tax filings.
You can use QuickBooks’s Accountant and Tax Reports feature to track the transactions better by identifying your accounting and financial activity throughout the year.
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8 Essential QuickBooks Reports That You Should Have
Below are the eight QuickBooks reports that can provide you with valuable insights into your business finances and help you identify potential tax deductions.
QuickBooks Company and Financial Report
QuickBooks offers a suite of Company and Financial Reports that are invaluable during tax season. These reports track the company’s financial position, which can be very helpful during the tax season.
Here are the key reports in this category:
Profit and Loss Report
Profit and Loss reports provide a snapshot of your business’s financial performance over a specified time frame.
These reports come in three variations: Standard, Detail, and Year-to-Date.
- Standard Profit and Loss Report: Provides a summary of the company’s profitability during a specified period to simplify tax preparation
- Profit and Loss Detail Report: Lists all transactions over the selected period, helping you discern expenses and revenues.
- Profit and Loss Year-to-Date Report: Allows you to easily compare your current income and expenses with the previous year’s data during the same time frame.
Income and Expenses Report
Income and Expenses reports in QuickBooks track your firm’s gross profit, losses, income, and expenses. QuickBooks Income and Expenses Report helps to track down your firm’s gross profit/loss or income/expense over a specific period.
These reports are classified into:
- Income by Customer and Vendor Summary: Helps to monitor the gross profit and total expenditure from each customer and vendor, respectively, for an efficient tax filing experience.
- Detailed Income and Expenses Report: Tracks the transactions for each customer or vendor, which will give you the largest source of income and expense at once.
QuickBooks Sales Report
Sales processes and invoices play a major role in the tax filing process. The QuickBooks Sales Reports provide detailed insights into your sales invoices, including sales by customers and sales by representatives.
- Sales by Customer and Sales by Vendor Reports: 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 due sales tax.
QuickBooks Vendors and Payables Reports
The QuickBooks Vendors and Payables reports summarize your sales taxes collected during the period and how much your business owes your tax agencies.
The reports in this category are as follows:
- Sales Tax Liability: 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: Summarizes the sales tax you have paid from the taxable sales during the selected time frame.
- Sales Summary: 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.
QuickBooks Employee and Payroll Report
QuickBooks Employee and Payroll Reports are paramount for verifying and tracking expenses for human resources and payroll employees. You can use this report to gather the company’s tax filings, cross-check financial data, employee leaves and vacations, payroll details, and more.
When it comes to Employee and Payroll reports, there are several divisions, including:
- Payroll Tax Liability: Comprises all the payroll taxes withheld, due, and paid for individual company employees. Simply, it summarizes everything already paid for and what needs to be paid for all employees.
- Payroll Tax Payment: You can see all the payroll tax payments for the selected time period for better tax filing.
- Payroll Tax and Wage Summary: Shows your employee’s taxable wages and the withheld taxes from those wages.
- Workers Compensation: A type of accident insurance paid by employers without making any payroll deductions from the employees’ salaries, showing the compensation rate to be paid to every eligible employee.
- Total Payroll Cost: Calculates all year-to-date costs associated with your employees’ payments, including total, net, gross pay and taxes.
- Retirement Plan: Displays the total calculations made by the company and employees toward their retirement plan.
Recommended Reading: How to Manage Payroll for Your Small Business?
QuickBooks Budgets and Forecasts Report
QuickBooks’ Budget Reports display budgeted revenues and expenses for the fiscal year, allowing comparison with actual figures using the Budget vs. Actual Report.
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.
Here are the report variations to assist you with your taxes.
- Budget vs. Actual Report: Provides a side-by-side comparison of planned, budgeted figures and actual financial results for a specific period, offering a clear snapshot of a company’s financial performance.
- Forecasts Overview Report: Analyzes the alignment between actual revenues and expenses with the budgeted figures and helps compare them to projected amounts, enhancing the tax filing process.
QuickBooks Service Tax Report
Service Tax needs to be paid for most of the transactions. QuickBooks provides a platform to record and create different Service Tax reports.
Here are two of its variations:
- Service Tax Abatement Report: Provides a list of all the transactions on which reduction is calculated in exact percentage and amount.
- Service Tax Reverse Charge: Shows all the transactions for which reverse charge is calculated in service tax.
Bank Reconciliation Report
Bank Reconciliation Reports help you ensure that your financial records match your bank statements. QuickBooks provides a concise overview of your bank reconciliation process, giving you access to a summary of matched and unmatched transactions.
In the Bank reconciliation category, there are variations such as:
- Bank Reconciliation Summary Report: Gives an overview of reconciling a bank account, including starting and ending balances, cleared and uncleared transactions, and any inconsistencies between bank statements and QuickBooks records.
- Bank Reconciliation Detail Report: Offers a more detailed breakdown of the reconciliation process by categorizing every transaction as cleared or uncleared.
- Bank Reconciliation Discrepancy Report: Highlights transactions that are causing discrepancies during the reconciliation process, making it easier to investigate and correct errors.
- Deposit Detail Report: Lists all deposits made during the reconciliation period, including details like the source of the deposit and the amount. It helps ensure that all deposits have been properly recorded.
Accounts Receivable Aging Report
The Accounts Receivable Aging Report allows you to effectively manage outstanding customer payments. This report helps maintain a healthy cash flow and plays a significant role in accurately assessing tax liabilities.
Within the Accounts Receivable Aging Report category, you can choose from classifications like Basic, Detailed, and Standard for tracking outstanding customer payments.”
- Basic Accounts Receivable Aging Report: It categorizes outstanding customer payments based on the aging of the invoices. It typically divides unpaid invoices into aging buckets, such as current, 30 days overdue, 60 days overdue, and 90+ days overdue, to offer insights into the aging of your receivables.
- Detailed Customer Receivables Report: Provides a more comprehensive view of outstanding payments, focusing on individual customers by listing customer-specific outstanding invoices.
- Standard Accounts Receivable Aging Report: Tracks outstanding customer payments, providing a detailed breakdown of unpaid invoices, including aging categories, specific invoice details, cash flow management insights, and considerations for tax planning.
Accounts Payable Aging Report
Much like its accounts receivable counterpart, the Accounts Payable Aging Report is indispensable for businesses to track and manage unpaid bills effectively.
Let’s explore its various types.
- Basic Accounts Payable Aging Report: Divides outstanding bills into aging buckets, such as current, 30 days overdue, 60 days overdue, and 90+ days overdue, providing insights into your payables aging.
- Vendor-Specific Payables Report: Lists unpaid bills by vendor, helping you prioritize payments and maintain strong vendor relationships.
- Accounts Payable Aging Report: Offers a detailed breakdown of outstanding bills, including aging categories, specific bill details, expense control benefits, and considerations for optimizing tax deductions.
How to Access Tax Reports in QuickBooks?
Before delving into the specific reports you’ll need, let’s elucidate how you can effortlessly access tax reports within QuickBooks:
- Log in to QuickBooks: Start by logging into your QuickBooks account.
- Navigate to the Reports Tab: Once logged in, go to the Reports tab located on the left-hand menu.
- Select the Desired Report: Browse through the list of reports to find the one you need for your tax preparation.
- Customize the report (if necessary): You can often customize the report by selecting the date range, specific categories, or other relevant options. This customization ensures that the report provides precisely the data you need.
- Generate the Report: Click the “Generate” or “Run Report” button after customizing. You can save the report for future reference or share it with your tax professional.
Ready to File Your Taxes?
Assisting clients in navigating through the complex world of tax compliance necessitates more than just expertise but also the right resources. QuickBooks Reports emerge as an indispensable asset in this endeavor, transforming data into actionable insights and ensuring tax filings are a requirement and an opportunity for financial optimization.
QuickBooks equips you with the means to seamlessly track income, expenses, sales, and payroll while also facilitating the anticipation of future business revenue.
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 spreadsheet. Furthermore, it empowers you to maintain a vigilant eye over outstanding customer payments and unpaid bills, facilitating optimized cash flow management and deductions for your clients.
QuickBooks can help you track all your data for tax filing processes. Moreover, you can customize these reports or create them at your convenience to meet your business requirements.
Our solutions consultants are ready to assist you with further inquiries or guidance. Reach out to us at +1-855-223-4887 or chat with our consultants.
QuickBooks Reports – Frequently Asked Questions
Why do I need QuickBooks reports for taxes?
QuickBooks reports provide valuable information 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.
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, commonly used reports include Profit and Loss, Balance Sheet, Sales Tax Liability, and Payroll Tax Liability.
How do I generate these reports in QuickBooks?
To generate reports in QuickBooks, go to the Reports tab on the left-hand menu and select the report you want to run. You customize the report by selecting the date range and other options before running it.
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 provide additional information that may be necessary for your tax returns.
Can I use QuickBooks reports as supporting documents for my tax returns?
Yes, you use QuickBooks reports as supporting documents for your tax returns. You should keep a copy of these reports for your records and provide them to your tax preparer if necessary.
Can QuickBooks help me file my taxes?
While QuickBooks can provide 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 tax preparation software or with the help of a tax professional.