Why are my non taxable sales not coming up on my sales tax liability report?

Welcome to the Community space, @admazingimprints.

Our Product Development team has determined that this behavior is by design. However, you'll have to make sure that the item is set up as non-taxable. You can change it in the Product/Service menu. Let me show you how.

1. Log in to QuickBooks Online.
2. At the left menu, click Sales and select Product and Services. 
3. Locate the item and click Edit under the ACTION column.
4. Scroll down to the Product/Service information screen. Select Nontaxable under the Sales Tax category field.
5. Click Save and close. 

Changes to the item's information will only affect future transactions. You can do the same process when creating new products. 

Also, you can pull up the Taxable Sales Detail report. This will show the list of customers with non-taxable sales within a specific period. Just click this article for more details: Create a Non-Taxable Sales Report in QuickBooks Online.

Once done customizing, you may want to consider memorizing the report. Doing so helps you save the current customized settings in QuickBooks Online. 

You can as well read these articles as your guide while managing sales taxes in QBO:

• Sales tax in QuickBooks Online
• Set up your sales tax

Reach out to me anytime if you need some help working in QuickBooks. I’ll be glad to assist you further. Have a good one.