Arti Patel Martinez, ProAdvisor Training & Certification Leader: On today's episode of In the Know, we'll be demoing the latest updates to Sales Tax Liability reports.
Hey ProAdvisors, it's Arti, and you're watching In the Know, where you get exclusive access to demos of Intuit product enhancements by the leaders who built them.
Let's jump right in with David Gudai, who will show us more features on the new Sales Tax Liability reports.
David Gudai: I’m super excited to share more about what we've been up to with sales tax and reporting. My name is David. I work out of our New York City office. I'm a product manager and lead sales tax at QuickBooks. Let's dive into the rest of the shareouts and show you what we've been cooking up for a new reporting experience.
First of all, why are we building new Sales Tax Liability reports? To just kind of anchor on that, we had Classic View in QuickBooks Online and IES [Intuit Enterprise Suite]. We had Modern View get introduced as well. Pretty similar; we introduced a rates column, but what we've been hearing for a while now is that both of those online experiences diverge from what's in Desktop and diverge from what you're used to.
You're either missing info that requires you to do extra steps. Think export, reformatted Excel, manually looking at invoices and transactions, and credit memos to try and reconstruct it, having to switch the tax rate from automatic to custom rates or vice versa, and a bunch of other things. We don't want that to be your experience. We want it to be super smooth and clean so that you can see the numbers you need for your refiling. You can trace where they came from. You can customize the report to your specific state of needs.
We've been going pretty deep and just reimagining the report entirely. We started off with some of the best aspects of Desktop that we're missing, and then we built from there. How do we avoid needing to cross-reference three different reports, or needing to export to Excel, have a special template with multiple tabs and custom formulas, and just allow you to do things within the report to just transform it overall? Whether that's a presentation layer, an interaction layer, customization layer, lots of possibilities, we went really deep into transforming what their support looks like. I'm super pumped to share where we're headed with it and what's now available for most of y'all.
Just to kind of give a sense of what we've been hearing for a while, kind of similar to what I started with, they were things like this. This customer base in Arizona, allows me to see the city and county in the sales tax separated out, so I can more easily file with the state of Arizona. On the right is the Arizona form. As a bit of a contrast, this next slide from a customer base in Ohio. Here, we don't pay it by the individual county; we pay it grouped together as state, county, and district, aggregated. And so we need that automatic calculation to be presented only at the county level, and these two are a nice contrast of how complex sales tax gets from state to state.
When the reports differ, the rules differ, and the underlying mechanisms of how it's constructed and calculated differ state to state. Even just that little can of soda has different rules. Is it a certain number of ounces? Is it orange? Is it orange juice? In a different state? For that automatic calculation and how it gets reported to a given state, starts to diverge as well. That sort of wide spectrum of ways that sales tax comes to life in different states is kind of at the heart of the challenge in coming up with a one-size-fits-all report. That's why we've evolved it to be a lot more flexible for you.
Some quick fast facts. Who is this for? It's for anybody with sales tax enabled in their account. They do need to be on the newer version, the automated sales tax version. So if you're still on classic sales tax, we'd need that to be upgraded to auto. We'll get to that in a moment. How? All of the usual places where you get to the sales tax report link: the reports page, the sales tax app itself, the returns page, a view summary, and an e-filing experience; all of those will take you to the reports. It'll also allow you to switch back and forth to the prior version of the report.
We started rolling this out just at the end of last month. Many of you should see this now in your company accounts and your clients' accounts, if you're not certainly, please feel free to reach out and we'll help identify if there are any eligibility criteria or other things we can do to facilitate either getting early access or confirming eligibility of access. And this is a US specific report. Okay, last bit, and then we'll get into a live demo.
Who's eligible? As I mentioned, classic sales tax is not available. So, if sales tax in QuickBooks looks like the left version here, it’s a bit dated. That report is not going to be available in that version. If, instead, your experience looks like this, a little bit more of a dashboard view and then additional pages in the navigation underneath sales tax, what we call automated sales tax, which includes both automatic and custom rates in the U.S. that's going to be available for you. Or if not, we'll be rolling out very soon.
All of that to lead up to a really cool demo, and I'm pumped to share what we've been cooking up here. Let me switch over to our demo. Great. Let's dive into the new Sales Tax Liability reports. We can access it from the reports page by clicking on reports, standard reports, scrolling down to sales tax, or typing in the search box at the top. The new report has a beta label. The prior version of the report continues to be available with a legacy label. If you're used to navigating by going to all apps and sales tax. You can continue to do so, and it will take you to the new report. And both reports are cross-linked to each other. When we click on the new Sales Tax lLiability report, we can see out the gate that the information is presented rather distinctly from how it has been in the past.
One of the key features of the new report is introducing nesting, where geographical relationships are presented by clustering together and indenting where applicable. So here we can see Durham County District is under Durham County. In the prior version of the report, when I click on Find Legacy Report here, we can see it's a bit of a flat list that's sorted by type. So we have our state, and then all our counties, and then our districts at the bottom, which makes it hard to see when cities belong to certain counties or county districts belong to certain counties. Another common ask we've had has been for totals. Here we only have the $4,008 showing up as our total, whereas in our new report, we can see it's $59,000 of total sales from this much of non-taxable and this much of taxable. Additionally, we've brought new flexibility with drill doubts.
If I flip back and click on my 8557 for non-taxable in Union County, we'll notice that the numbers are talking about tax amounts and taxable amounts, but I had clicked on the non-taxable. One of the asks was to bring back the parity; if we click on 8557, just show the numbers that contribute to the 8557. In this case, we're customizing it to show it by customer. We could flip that to be transaction instead, and so here we could see 1093 from Jane Doe along with 45 and 1105. But that's not all. We wanted to bring that flexibility without necessarily needing to go into a separate report or a separate page, and so that's where these chevrons become really powerful. I can expand Mecklenburg, and I can see it is invoice 1125, or I could expand Durham County 1015 or Union County 10 939495. From this view, we're bringing in all these different pivots that allow you to easily see transactions or customers, and a whole lot more without needing to flip between multiple different reports.
Another common ask we've had is to better align with the way states have the information presented on their forms. So, if I switch from North Carolina, where you would report it pretty closely aligned with this structure, to a state like Florida, for example, we can kind of explore this additional functionality that, aside from nesting and being able to see the breakdown by specific counties, and this new ability to see the portion that was subject to only the state tax.
If we summed up all our counties, the balance is this 123, We want to give you more flexibility to just pivot the whole report entirely. In Florida, we report based on the tax rate, not necessarily the tax jurisdiction. Being able to click tax rate in the customized bar, and now I have all of my one and a half percent, my 1% my 0.5% grouped together allows me to easily report to the state in the format that they need.
Conversely, if I flip back to tax jurisdiction and I go to a different state to see another flavor of this in a state like California, this becomes really interesting. Where we would need to group together our one percents that are the local tax. It's the county where the business came from, so it's a hybrid destination origin state in the way that they handle tax calculations. We have 1% that represents the business address, and then we have all the district taxes, the county districts and city districts beneath it for the customer's address.
We see a few more unique things about California in this case. Here, Kern County doesn't have a county level district tax; it only has a city district tax for Bakersfield. So we have that 1% there. Similarly to that Florida example where they were state only, here we see county district only. In this case, the sales that were in LA County were in an unincorporated part of the. County, so there was no additional city surtax applicable. Whereas Burbank and Alhambra, in this case, both have additional 0.7 fives. These tooltips help clarify that this 8480 is already baked into our 514 31, so we know not to count it again. But if we need to report just the county district line. This is that number, cleanly presented.
We're introducing new combination logic that allows you to do calculations in the report itself. So if I go to customize and I switch components to combine, I can choose to combine my county district and my city district together. This will get us to a place where the county district portion of the tax flows into the city district, and that becomes really powerful because California wants that additional, in this case, 2.5% included with the point seven 5% for the 3.25 overall. This is just a taste of the functionality that we've been bringing to life. We have more coming soon.
I would love for you to explore, play around with the customization capabilities available now, and please share your feedback for anything we could do to continue to make this as powerful as it can be, and just streamline your workflows as you're preparing sales tax.
Awesome. Well, I hope that demo gave you a good sense of the new capabilities we've been bringing to life. Things like that really align with that Ohio example, where you can combine state, county, and districts accordingly, and just have a ton of capabilities. But yeah, I would love to open it up to Q&A.
Arti Patel Martinez: Okay, so with that, let me do one live question, David. What other enhancements are ahead for the report?
David Gudai: I'm glad you asked. Frankly, a lot. This has been really a big reset of the foundation moment for us, and now we're going to be able to do so much more. We're going to have more subgroup options. I showed how we could flip between customer and transaction. We're going to add the reason it was tax-exempt in the first place, which ends up being a really powerful report, especially for the first schedules in many states. We're going to allow splitting out non-taxable from exempt into two separate columns, which is huge in certain states to have those reported separately, so that's going to be really cool.
Another common one that kind of goes back to the poll question: codes. We know we need codes visible. That's how it's reported. That it gets really messy and complicated in certain states where location codes come into play. Washington and Colorado in particular. That's coming soon. It'll allow it to show up as an additional column. It'll also allow it to be the primary column. If that's the way you reported in a given state with code, that is how this report is going to be presented in the coming months, or at least the flexibility to make it so.
Other things, some states are really bunky. So local and state agencies in Colorado, Louisiana, others mean right now agencies and reporting. We're going to allow that to be merged into a unified report structure. I think that's going to make things a lot cleaner and neater, and just allow you to fill in those sales tax forms that much smoother. So a lot. We have a lot underway, even more than the way I just mentioned. Reports overall with modern view and new capabilities continue to push the envelope for what's possible, and we'll be incorporating the best aspects of those as well. So yeah, super super pumped to kind of continue to release more. And if you have feedback, please do send it in, and we'll be sure to bring all those options to life.
Arti Patel Martinez: Amazing, David! Thank you so much for that walkthrough. Lots of really great detailed information. If you find this update interesting or helpful, go ahead and like, comment and subscribe. That's all we have for now.
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