Tax Liability Account (Credit Balance)
These accounts are used to post the actual taxes owed to tax Vendors. An account gets credited when an invoice containing taxable lines is paid in full when reporting on a cash basis. The amount to be credited is the balance per invoice detail line in the accrued tax liability account.
Tax Vendors must contain the corresponding Tax Liability account in the ‘expense’ field on the Vendor record in order for these accounts to report correctly on the general ledger as well as on the tax report.