In this presentation, we will discuss a method for tracking tax reductions related to personal state taxes within our business QuickBooks account using a classes method within QuickBooks. Here we are on the homepage, we currently have the open windows open, you can open the open windows by going to the view drop down and selecting the open windows list. We're not going to open our check register by going to the banking drop down and go into the use register. Then we're going to select the checking account and say okay, that's the one that we want. We have been continuing, we have been entering transactions from the bank statement directly to the check register. We're going to continue with this process.

Now. If we go to our bank statement, we have been entering all this data in place we've been recording transactions out of the bank statement to QuickBooks, we're going to continue with that process. We're going to insert one more transaction that's kind of a normal business expense that being the payroll check to our employee. Rebecca Robinson, and then we'll add the new item, which we have consciously started doing that been to pay state taxes that we think may be something that could be deductible, but are not business expenses out of our business account, so that we can then track it so that we can provide reports to the tax prepare at the end of the year. So specifically, we're thinking this is going to be, in our example, property taxes on pet, possibly our personal residence. But again, any state tax might be something that could be taxable or deductible, and therefore, we might put into something like a state tax and just be able to give it to our tax preparer and see if it's something that can't be deductible.

Remember that that the property tax might be tracked by say, our mortgage company, and then they might make give a form for at the end of the year. If they do. Great. We may not need to do this. However, if they don't, or if we if we pay for outside of our mortgage company statement, then we'll have to track it in some way. This would One way we can think about it.

And again, we could add other tax like DMV, DMV charges and taxes and whatnot, for the Department of Motor Vehicles, or whatever state and local taxes, we might want to add up and see if we can deduct it there. So in any case, that's what we're going to do here, we're going to start with the Erica Robinson and record just kind of a normal business expense. So we'll enter this as of the we're back to our check register here, by the way, back to march 31. And this was the paycheck it's gonna be check 1045. And this was to Erica Erica Robinson will populate for us. And that was for 630.

Now we have to assign an account because it's it's a payroll account, so we're gonna assign payroll expense and enter that information there. There's going to be just a normal type of business expense in that we're not going to get into again payroll, but normal type of business expense. So we'll check that off. We've got that And then the next item here is going to be a kind of our newer item, which is going to be the state tax deduction, we're gonna have to set up a new account for that that happened on 325, that we've made that payment. So and that's going to be check number 1042. And we're going to type in a new account now.

So above, not a new account now, but whatever, the new vendor, which is going to be the state tax, and I'm going to just say, property tax. And of course, we would have the name of the state would be the vendor that's just a generic name, we're going to quickly set it up with the quick add, we're going to set it up as a vendor, we're going to put the amount of 346 we paid, then we're going to add a new account. So this is a new account. This is the first time we pay this personal tax out of the account, setting that up. Then we're going to hit tab to set it up and set up that account expense. That's what we want.

So we will then say Save and Close and then we'll go to the Split. And we'll assign it to our class classes, we want to make it go to the tax deduction, personal class, and say record, there is that item. If we now look at our reports, then we'll go to the reports drop down, we'll go to the company and financial, we're looking for the profit and loss by class, profit and loss by class, we're going to change the dates from a 10119 to 1230 119. That's going to be January 1 2019, to December 31 2019. If we scroll down, then we will find that we have our other pairs all these personal accounts make this a little bit wider, so we could see it a little bit better. And we're looking for the one related to state taxes.

There it is. That's what we just entered. It's not included over in the unclassified, that being our default, it's in the classified area. So we're going to go back here and this is our bank statement, cross that one off that one has Now been completed as well. We're going to continue we still have to enter these last items and the deposits before we do the bank reconciliation for it.