Quickbooks - Sales Tax on DROS only sales

[Boogaloo]

If you guys are generating sales receipts for customers that come in for a transfer (DROS) only transaction, how do you have QuickBooks set up to show the tax you are required to collect on firearms from other FFL's/Dealers/Online retailers ?

I am having a hell of a time getting something effective working that will allow me to add a "phantom" item to the invoice and calculate tax properly without screwing with my own inventory.

Any ideas?

[monkezuncle]

Make it a non-inventory item or a service that associates with a special "DROS Tax" account or similar that you set up.

[ugimports]

Originally Posted by Boogaloo

If you guys are generating sales receipts for customers that come in for a transfer (DROS) only transaction, how do you have QuickBooks set up to show the tax you are required to collect on firearms from other FFL's/Dealers/Online retailers ?

I am having a hell of a time getting something effective working that will allow me to add a "phantom" item to the invoice and calculate tax properly without screwing with my own inventory.

Any ideas?

I do the following (assume $100 paid to out of state dealer):
1) I have created a non-inventory item called "customer paid"
2) I add "Customer Paid" line item for $100 Taxable
3) I add "Customer Paid" line item for -$100 Non Taxable

This leaves the tax paid showing up correctly and doesn't mess with inventory and makes it pretty clear to my customers.

[Boogaloo]

Great ideas gent's, thank you very much!

[curvejunkie]

Ug, that is a great idea. Thanks!

[Toby's Tactical]

Originally Posted by ugimports

I do the following (assume $100 paid to out of state dealer):
1) I have created a non-inventory item called "customer paid"
2) I add "Customer Paid" line item for $100 Taxable
3) I add "Customer Paid" line item for -$100 Non Taxable

This leaves the tax paid showing up correctly and doesn't mess with inventory and makes it pretty clear to my customers.

This is how I do it. I use the text "Incoming transfer" and "Outgoing transfer". I couldn't find a way to do a single line that wouldn't count the firearm price toward the total but have the tax count.

[JDay]

DROS fee's are NOT TAXABLE.

http://oag.ca.gov/firearms/dlrfaqs#40G

May I charge sales tax on the DROS fees?

No. On January 1, 1999, the state Board of Equalization ruled that the DROS fees are not subject to retail sales tax. Firearms dealers licensed pursuant to Penal Code section 12071 shall not charge sales tax on the DROS fees. Questions regarding firearms transfer fees can be directed to the DOJ through this website or by calling (916) 263-4887. Questions regarding sales tax can be made to the California Board of Equalization at its website www.boe.ca.gov.

EDIT: Not sure if you meant DROS fee's too but I see you're talking about out of state transfers. One other thing, you should not use QuickBooks for accounting, you will have problems should the IRS ever audit you.

[ugimports]

Originally Posted by JDay

DROS fee's are NOT TAXABLE.

http://oag.ca.gov/firearms/dlrfaqs#40G



EDIT: Not sure if you meant DROS fee's too but I see you're talking about out of state transfers. One other thing, you should not use QuickBooks for accounting, you will have problems should the IRS ever audit you.

Not taxing DROS. What is the issue with Quickbooks for accounting? My landlord (who also does taxes/accounting) uses quickbooks for 99% of their customers and they are capable of representing me in an audit. What are the red flags I need to be worried about? Most of my setup is basic and for the few things I was missing my accounting folks helped me add it in (such as separate petty cash account, etc...).

[Boogaloo]

Well I have been using the method suggested by ugimports here since I posted this question and it is just perfect. Thank you for the heads up brother!.

[JDay]

As long as you have an accountant checking stuff you'll be fine since they'll catch the stuff Quickbooks misses. I'm just saying it's not a substitute for one. Doesn't matter that they'll represent you in an audit since you're the one held liable.

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