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amalandy
May 21, 2020
Question

Need help with posting Business / Federal / Income / Corporate Tax

  • May 21, 2020
  • 1 reply
  • 0 views

I prepared my books for my one person corporation in Quickbooks Desktop. I proceeded to fill in the tax forms. When I finished it shows that I owe

some taxes. When I come back to my books and post this tax as an expense, it changes all the numbers and it changes my P&L and balance sheet. If if

take those numbers again and try to put them in the tax form, this would become a cycle. How do I avoid this. In particular, if I show the tax I owe

as a liability or accounts payable, which account should it be debited against? An expense account, an Asset, Owner's equity, Retained earnings?

Which one? I am confused and need help. Thanks.

1 reply

MelanieSchroederCPA
MelanieSchroederCPA
August 2, 2020

Your income tax expense does not affect the amount of tax owing on your corporate tax return. When you set up the accounts in your QuickBooks for the taxes payable and the tax expense you must make sure to code the tax lines correctly. If you do so, the tax owing should not change and the tax expense amount on your profit and loss will show as an add back amount on your schedule 1.  

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