My taxable rate in my area (Texas) is 8.25%. When I receive a partial payment from a client (for a deposit), the system adjusts the rate to 7.62% instead of keeping it at the 8.25%.
This is problematic because even if I receive a deposit, in say, Q3, but the balance isn’t paid until Q4, I still have to pay the Texas Comptroller tax on the deposit. It’s not reconciling.
Here an example.
Client receives invoice for $750, and total with tax is $811.88. Total tax to be paid is $61.88
I receive a payment of $300. The tax to be paid for that quarter (if not paid in full) is $24.75.
However, on my tax transaction report it is showing $22.86.
I did have a client that made partials all the way through the same quarter, but by the time I received full payment, the taxes reconciled.