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    23 Replies Latest reply on Mar 10, 2009 3:02 PM by QB_Accountant

    Event:  How to use QuickBooks to prepare your taxes

    SBC Team Guide
      This event will cover some target areas that you can troubleshoot in your QuickBooks file and how to fix them, some tips and techniques to examine and verify that your QuickBooks file is as accurate as possible and how to prepare your file to be ready to take to your tax accountant.

      Amy Vetter, CPA.CITP leads the Florida office for Technology In A Box, LLC and serves as CFO and Executive Director for the company. Technology In A Box, LLC is a national consulting firm that offers complete end-to-end solutions to small to mid-market businesses and franchises.

      Amy Vetter is an accomplished author of QuickBooks reference materials and is a contributor and speaker for Intuit's courses for Certification and Training of QuickBooks ProAdvisors and Accountants. Amy has been recognized by The CPA Technology Advisor as an outstanding 40 under 40 technology-based Accountant and was also awarded South Florida Business Journal's Up & Comer Award in 2007 for her expertise in accounting. Visit her at

      Amy can answer questions such as:

      • This is my first year filing my small business. What are some best practices?
      • When and how do I make corrections to the QuickBooks data file?
      • How do I even begin to work with the data file?
      • What are some quick tips to customizing QuickBooks before filing?

      Post your question here and then join the live event on March 10 at 2:00PM EST for Amy's reply. You can also pose a question any time during the event hour.

      What's your QuickBooks's question?
        • Re: How to use QuickBooks to prepare your taxes
          Tori Scout

          What prep work should people do in advance so they can work productively on QuickBooks?
            • Re: How to use QuickBooks to prepare your taxes
              QB_Accountant Newbie

              You should start preparing back up of the documents that you are going to need to either file your taxes or get up and running in QuickBooks. Some Documents to collect in order to prepare:

              • Trial Balances from prior accounting system - i.e. 1/01/08-12/31/08, 1/1/09-1/31/09, 2/1/09-2/28/09, Tax Return for 12/31/08 (if available)
              - Bank Statements and Reconciliations: All Bank statements for each end of month and Bank Reconciliations for each month (list of outstanding checks and deposits)
              • Credit Card Accounts: All Credit Card Statements Used for Expenses (if any)
              • Merchant Processor Statements: MC/Visa, AMEX or any Other
              • Loans / Lines of Credit: Current Balance outstanding as of end of month prior to conversion
              • Payroll - Current reports from Payroll Processor
              • Accounts Receivable - List of Open Invoices as of month end
              • Accounts Payable - List of Unpaid Bills as of month end

              It is also good to either contact a QuickBooks ProAdvisor for one on one training or signup for a QuickBooks Training Class or Webinar. It is all in the set-up! If the QuickBooks file is set up wrong, everything snowballs after that!

              Good Luck!
            • Re: How to use QuickBooks to prepare your taxes
              Cheers Newbie
              How do I join the event tomorrow? Is there a sign-up link?
                • Re: How to use QuickBooks to prepare your taxes
                  SBC Team Guide
                  Participating in an event is easy! The event takes place on this forum thread. We know business owners are busy, so we collect questions in advance of the event - just reply to this thread to post your question. Or during the event tomorrow, you can post your question.

                  Amy's reponse will be on this event thread, so you can check back during the event or after for Amy's response.

                  Post your question today Community.
                • Re: How to use QuickBooks to prepare your taxes
                  antiques4me Wayfarer
                  I've been hearing about QuickBooks online, how is that different from the QuickBooks software that I download or by from the store?
                    • Re: How to use QuickBooks to prepare your taxes
                      QB_Accountant Newbie
                      QuickBooks Online is very different from the QuickBooks desktop software. QuickBooks Online is meant for businesses that have a very simple accounting set-up. I have copied in a link here that compares the QuickBooks Product Lines:


                      This is a chart that compares all of the features between QuickBooks Online and the Desktop Versions.

                      QuickBooks Desktop versions can now be hosted tho! Through a web hosting provider that has been approved by Intuit, you can have QuickBooks Desktop hosted through that company's servers and you can access your QuickBooks file through the Internet from wherever you are. This gives you the full functionality of QuickBooks by using the desktop version and give you the flexibility to access it through the web!
                    • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                      Howard Adventurer
                      What's new with QuickBooks 2009? Trying to decide if I need to upgrade or not.
                        • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                          QB_Accountant Newbie

                          The real question is...what is not new with QuickBooks 2009! There are so many changes and updates, here are a few:

                          For QuickBooks Enterprise -
                          All features of Pro and Premier, plus:
                          • 5 User to 30 user license now!
                          • Terminal Services enabled
                          • Online Suite of Applications - Warehouse Management, Field Service Management, Business Analysis
                          • Full Service Plan - includes Technical Support and automatic upgrades as long as you continue to pay and annual fee for the Full Service Plan

                          For Premier Accountant Edition 2009 (includes all features of Pro and Premier, plus) -
                          • New Client Data Review tool to help Accountant's review for errors in the QuickBooks file
                          • Intuit Statement Writer - Custom Report Writer using Microsoft Excel
                          • Update to the Accountant Copy Feature to make it easier for Accountants to work with their Clients
                          • External Accountant User - provides Admin level access to an External Accountant

                          For QuickBooks Pro and Premier - non-Accountant version:
                          • Bank Reconciliation Feature - you can now sort a Bank Rec Window
                          • New Online Banking Center
                          • Enhanced Merchant Service Processing Features
                          • Company Snapshot - provides a dashboard of most important operating issues of the day
                          • Multi-currency Capability
                          • Back-up data in Multi-User Mode
                          • Live Community Forums
                          • QuickBooks Instant Messenger in Multi-User Mode
                          • Improved list management, duplicate list items, search capability on lists
                          • Big Red X - warns you if you are closing a QuickBooks file!
                        • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                          Tori Scout
                          Welcome back to SBOC Amy! Many small business owners use QuickBooks to manage their business. Now that it's tax time, can you point out any helpful reports or features that will make preparing taxes easier?
                            • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                              QB_Accountant Newbie

                              Thanks for having me back!

                              Here are some helpful reports at the end of the year to check in your QuickBooks File to make sure your Financials are showing the right balances:

                              • Open Invoices - Under the Reports Menu, Customers and Receivables, choose Open Invoices - make sure that all of the open invoices are showing haven't been paid. If they have been paid, you are going to need research to make sure that Income has not been double counted somewhere. If there are customer payments that haven't been applied, apply them to the invoices. The other to check for is old outstanding invoices that need to be written off.

                              • Open Vendor Bills- Under the Reports Menu, Vendors and Payables, choose Unpaid Bills - Same issue as above, just for vendors.

                              • Bank Reconciliations - Under the Reports Menu, Banking, choose Previous Reconciliation - Make sure that all of your Bank Reconciliations have been completed through the year end. You will see a list of them there and can view each one.

                              • Accountant Reports- Under the Reports Menu, Accountant and Taxes - lots of reports here you can check into, such as:
                              --Voided/Deleted Transaction Summary Report - make sure that there are not any transactions on there that were deleted and shouldn't have been
                              --Closing Date Exception Report - Make sure if a Closing Date was set no one affecting any balances in the previous period
                              • Trial Balance Report - your accountant will want that
                              • Income Tax Summary or Preparation Reports - if you set up your Chart of Accounts to link to a tax line, then this report will give you an idea of how things are being accounted for. You can make sure you agree with how those are falling out on your financial statements that way.

                              That should get you started and help you to clean up your file before giving it to your tax accountant!

                            • Archiving QuickBooks
                              amspcs Ranger
                              Hello. Long time QB Pro user here. My QB file is HUGE!!!...dates all the way back to 1996.
                              I'd like detailed instructions on how to archive some of the really old data so I don't lose it
                              permanently, but I get it off my hard drive and backup zip where it takes up much too much space.
                              I do not wish to upgrade to Enterprise, don't need it. Thanks.

                                • Re: Archiving QuickBooks
                                  QB_Accountant Newbie
                                  WOW! So, I bet you still have schoolwork and textbooks that you had in grade school like me! So, here are some options for you:

                                  1 - There is an archive function in QuickBooks - under the File Menu, Utilities, Clean Up Company Data. This does not officially reduce the size of your file, however, this is what can - When you start this process, it will ask you to Verify Your Data - make sure you do that first! Make sure there are no errors in the QuickBooks file. If there are errors in the file, it is going to ask you to Rebuild the Data file - which that is going to take a really long time on a file that old. So...make sure when you start this process, you move your QuickBooks data file OFF of the server onto your hard drive. If you try doing this on your hard drive it is going to take a really long time. Once you have no errors in the file, you can back it up and save it under a different name so you always have that data if you need it. Then it will walk you through purging transaction history for whatever year you want to. It will leave the Trial Balance in the file for each year - but it will not have detailed invoices from 1998...

                                  2 - After you run the Clean-up Company Data utility, then create a portable company file. Then close the data file. Find the Portable Company File you saved and restore it to a QBW file. Your file should have reduced in size a bit by doing this.

                                  3 - There are clean-up tools from Baystate Consulting as well that will help you delete transactions from a file and then we would run through this same process of creating portable company files. However - you really should have a Consultant involved with those tools so that you don't delete something you need.

                                  Hope that helps!
                                • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                  caffeinated Scout

                                  I already filed, but came across a 1099-INT that I missed. What do you suggest I do in terms of updating my data file? And can addendums (1040X) be filed eletronically?


                                  Thanks for helping
                                  • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                    SBC Team Guide

                                    Community please join us in welcoming Amy Vetter a QuickBooks expert from Technology In a Box, LLC. Amy will be with us until 3:00PM, so if you have a QuickBooks tax related question, ask your question now!

                                    Tips: Don't forget that you need to be logged into your member account to post your question. If you aren't a member, it takes only two minutes to join SBOC and it's free! Simply click on the green Join Now button.

                                    Also, don't forget to refresh your screen often so you can see Amy's latest response.


                                    • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                      SBC Team Guide
                                      Thanks Amy for taking the time today to share your expertise on QuickBooks and taxes. Community if you want to learn more about QuickBooks and the services offered through Technology In a Box, LLC please go to
                                      • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                        jackzee Newbie
                                        What are the most time consuming mistakes people make when using QuickBooks to prepare for taxes and how can I avoid them?
                                          • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                            QB_Accountant Newbie
                                            Well, typically the time consuming mistakes happen throughout the year. If you are not vigilant in having your accounting reviewed on an ongoing basis throughout the year, you could end up with a lot of work in cleaning it up.

                                            Also, if you did not take the time to set up the QuickBooks file properly with a QuickBooks ProAdvisor or your Accountant, you may find a lot of errors when it is time to do your taxes. Here are some things that you should do throughout the year:

                                            • Bank Reconciliations every month
                                            • Sales Tax Returns, if applicable, every month or quarter. Make sure if you file sales tax returns, no one affects a prior transaction that has already been filed. If there is a change to a prior month invoice, it should be dealt with in the current month as a credit memo or additional invoice so Sales Tax reporting still ties
                                            • Physical Inventory each month, if applicable
                                            • Make sure Undeposited Funds has been properly grouped to a deposit. Many errors or found when invoices are recorded, payments are received against the invoices, but the payments are never grouped to a deposit. Instead, a manual deposit is entered to an income account so a Bank Reconciliation can be completed. So, income is counted 2x. That has to be fixed as soon as you find that.
                                            • Ending balance given to your tax accountant were changed throughout the year. Make sure to set a Closing Date and Password in QuickBooks so that you can protect these balances from being affected after a year is closed out.
                                            • Open Bills were not paid with a manual check instead of a Bill Payment Check in QuickBooks
                                            • Make sure Sales Tax was paid with a Sales Tax Payment Check and not a manual check in QuickBooks
                                            • Make sure that Payroll Taxes - if using Intuit Payroll - is paid with Payroll Liability Check and not a manual check

                                            That should give you a start!
                                          • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                            SBC Team Guide

                                            Don't forget to refresh your computer screens! We have 30 more minutes with Amy, so if you have a question, it's still not to late to ask right now.
                                            • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                              mominbiz Newbie
                                              Unfortunatetly, I have co-mingled by business finances with my personal finances and have them all on Quicken. Is there an easy way to export data from Quicken into Quickbooks or would you hold off and just make sure to run 2009 cleanly through Quickbooks. I would then just have to do 2008 the same manual (painful) way I always have
                                                • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                                  QB_Accountant Newbie
                                                  Not a good situation you are in! You definitely want to set up 2009 on the right foot!

                                                  So, you can convert a Quicken file to QuickBooks, but in this case, I am not sure that it is going to save you time. Reason being, you will have to go back and delete all the comingled transactions from the QuickBooks file once you convert it.

                                                  My suggestion to you would be to start a new QuickBooks file fresh. In one of the prior posts I have listed some documents that you should prepare for a Tax Accountant - it would be the same for setting up a new QuickBooks file. You will need that to get your beginning balances in and start clean! You will feel so much better next year if you get started on this now.

                                                  Good Luck!
                                                • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                                  FCPainter Adventurer
                                                  I hate to get 'in the weeds', but how do i setup 1.5% finance charges to statements in Quickbooks. I never really had to charge many customers for late payments before, but now I am starting to have to do more of it.
                                                    • Re: Event Mar. 10:  How to use QuickBooks to prepare your taxes
                                                      QB_Accountant Newbie
                                                      You will go to your Edit Menu, Choose Preferences, Choose Finance Charge.

                                                      When you enter in the Finance Charge amount - it is an annual interest rate - not monthly. So you would enter 1.5 * 12 - 14.4%

                                                      You will also need to code this to the income account you want it routed to.

                                                      When you are ready to assess Finance Charge, you will go to Customers menu, Create Statements, then Assess Finance Charges.

                                                      It will give you a list of the open invoices and you can select who you want to assess charges to. It creates an invoice for each of those Finance Charges you create to each customer.