Tax Line Assignment Instructions
by Bob Zedwick
I am a contractor trying to do my own taxes as an LLC, on TurboTax. Obviously, QB tax line assignments have to be set up properly for an accurate return. The tax line assignments are sometimes not very clear as to which one I should select for my application. Also the item list for COGs is very confusing with an expense account and income account assignment requirements.
It seems like a reasonable request, doesn't it? "Intuit, just tell us where to assign the tax lines in QuickBooks!"
From a business stantdpoint, however, I think I understand why Intuit doesn't do it.
If Intuit gave instructions on where to assign a tax line, it would be like providing tax advice. Then, if your return was audited and the IRS didn't agree with how things were assigned on the tax return, and you had to pay penalties and/or interest on unpaid tax, you could turn around and go after Intuit for bad advice.
I think this is the reason people can't find tax line assignment advice on the internet. A lot of people search for the terms "tax line assignments" or "tax line mapping." Because of this, I seriously considered writing a page to help people, but once I realized the potential tax liability implications, I decided not to do it.
If you are in doubt about tax line assignments, pay a CPA to show you how to do them the first year you do your own taxes. Then, in subsequent years, you can follow how that first year was done, sort of like following a "template."
This is just too important of an area to guess or take chances. Get paid advice from a trusted tax professional. It will be worth it in the long run.