Change your sales tax accounting method

The method that you use depends on the way that you track and pay your sales tax:

1. On the Sales Tax page, click Rates & settings for the tax whose reporting method you want to change.
2. Expand the Settings section and then click Switch to Cash or Switch to Accrual.

   The Agency details window displays.

3. In the Accounting method drop-down list, select the new method that you want to use.

   QuickBooks locates all open transactions for the previous year and includes them in the current accounting period.

When you switch from cash to accrual accounting, sales tax on all unpaid sales and purchases becomes due. You must report and pay this sales tax when you file your sales tax return for the current period. See Calculate new sales tax liability.

If you have unpaid transactions that you wrote off as bad debts, adjust your sales tax return manually to remove these transactions.