Dating US Tax Payments
T. Cabugao
tycabugao at earthlink.net
Sun Apr 4 21:17:13 EDT 2004
Allen Ziegenfus wrote:
> Hello everyone.
>
> I was curious how people handle their tax payments within GnuCash with
> regard to dates. Last year I ended up creating different tax year
> accounts (2002 Taxes, 2003 Taxes) so that 2002 tax payments made in
> January / April 2003 would be categorized as 2002 payments even though
> they have a 2003 date. However, now it seems a little silly to me to
> continually create these separate tax accounts ad infinitum. Is the
> recommended method to have just one tax account and fudge the dates so
> that 2003 payments made in 2004 will have a 2003 date (e.g., 12/31/03)?
> When I searched the GnuCash site I found some document that described
> that this is what the TXF report does. I'd like to have the reports
> show, within a single year, all the income and the taxes paid on that
> income for that year.
>
Here's how I have set up my accounts:
Asset: Tax Refund
Liability: Taxes Due
Expense: Tax
In Jan-April, once I figure out my tax refund/taxes due, I make an entry
for Dec 31 (tax year) to either the asset or liability account.
In case of a refund, I debit Asset:Tax Refund and credit my Expenses:
Tax account for Dec 31st. This lowers my Tax expenses for the tax year,
and adds to my asset. Once I receive the refund check from the IRS, I
debit my Checking account and credit my Asset: Tax Refund to complete
the transaction.
In case of having taxes due for the prior tax year, I credit my
Liability: Taxes Due account, and debit my Expense: Tax account, with a
date of Dec. 31st. This increases my Tax expenses for that year and
increases a liability account that I can zero out once I mail the IRS my
check.
You can use these Asset and Liability accounts year after year.
Hope that is clear enough.
Ty
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