Connex allows you to map tax codes based on the city, county, or state to QuickBooks. This allows for easy management and reporting of sales tax payable in QuickBooks.
Do I need to map QuickBooks tax codes?
If you live in a state like Massachusetts with a single rate, then we recommend using the codes. This makes both the accounting and reporting of sales tax easy within QuickBooks. However, if you live in a state where the tax changes depending on your rooftop location, then we recommend a third-party service to manage your tax.
Alternatively, for states where the tax changes depending on your city, we recommend adding tax as a line item because QuickBooks isn't made to handle taxes by the city, you may insert sales tax as a line item.
How do I map U.S. tax codes?
Tax codes must first exist in QuickBooks. Next, tax codes can be mapped to the appropriate state. However, if you need to match tax codes by city and/or county as well, please read these instructions.
How do I create a tax code in QuickBooks Online?
If not already set up, we must first set up tax codes in QuickBooks, which map a percentage and a U.S. state. Here are the steps:
- Login to QuickBooks Online.
- On the left, click sales tax.
- Next, on the right-hand side, click add/edit tax rates and agencies.
- Then, click new:
Finally, complete the on-screen instructions.
How do I map tax codes in Connex for QuickBooks Online?
Now that we have some tax codes, for U.S. customers, let's map existing QuickBooks Online sales tax codes:
- Log into Connex Online Landing Page:
- At the My Connections page, select your connection under Manage Connections, then click Manage on the right.
- On the the configure page, scroll down and click Sales Tax to expand the settings.
- Next, click +Add New Code:
Select the appropriate code from the drop-down and fill the remaining fields:
When finished, click Update - congratulations, the code is now mapped. This is what it will look like:
Next, map any additional required codes via the instructions above.
When complete, click Save Settings and Sync Now on the bottom right.
Third-party Sales Tax Management Services
If you're using a third-party service like Avalara or you have QuickBooks Online Automated Sales Tax enabled, you do not need to map sales tax codes. For third-party sales tax management solutions, enable tax mapping as a line item.
If QuickBooks Online Automated Sales Tax is enabled, no action is required - Connex for QuickBooks Online will detect this automatically.
Can you match tax codes by county?
Here is how it works:
- Add a tax mapping. In the county field, enter a county. Complete all fields, except city:
- Sync an order where the city on the sale exists in that county. In this example, the order is from Watertown, MA. Watertown exists in Middlesex county.
- In our database, there is a list of cities with counties and postal codes. If there is a match, then our tool will return a county.
- From your list of tax codes, Connex will match the county and the code provided.
- Connex will match the SalesTax tax code and Middlesex county.
The issue with counties is you would need one tax code per county. Some states have several counties and this is a cumbersome solution. Sales tax is only accurate by rooftop location and the product type. We cannot guarantee that all cities will match the correct counties in our database, though it should be fairly reliable. Our software will also try and match by postal code, if no city matches. Sometimes, a city contains an abbreviation instead of a full name. Instead, we recommend the following steps:
- Avalara, a third party service provider, provides a tax plugin for your site. They will calculate the tax rate per order, based on the shipping address.
- In QuickBooks, create a new sale.
- On the bottom right, click let QuickBooks calculate tax.
- Connex will detect this change and send the tax on the bottom of the sale.
- Avalara will pay local tax agencies on your behalf.
- Sales tax will appear in sales tax payable.