Taxing jurisdictions don't issue refunds, so use TrustFile to manage taxes you've refunded to your customers by applying credits to future returns in the appropriate jurisdictions.
TrustFile uses refunded transactions to calculate how much of a credit to apply to each affected jurisdiction. So, for instance, if you owe Brown County $12, but you issue a refund for a transaction that included $1 you previously paid to Brown County, TrustFile shows your corrected liability for Brown County as $11 (the original amount you owed, minus the credit from refunding taxes to the customer).
TrustFile applies as many refunds as it can to your return, starting with the largest credit. However, each refund credit is applied as an "all or nothing" amount, and negative tax liability amounts aren't allowed so some credits might not be applied. For example, if applying one of your credits would put your tax liability for Brown County into negative numbers, even if it's just -$0.01, TrustFile doesn't apply any part of that credit to any jurisdiction.
TrustFile keeps track of the amount of credits it doesn't apply and displays that dollar amount in the Credits Not on Return field as a negative number, e.g., ($-19.23). At this time, TrustFile doesn't automatically apply these credits to future returns, but you can manually apply them.
To manually enter credits so they can be applied to the next return:
- In TrustFile, on the Returns page, under the return you want to apply the credits to, click Make an adjustment. The Make an adjustment dialog box opens.
- Subtract the amount of the credit you're applying from the amount shown in the Current tax collected field, and enter the resulting number in the Adjusted tax collected field. For example, if the amount in the Current tax collected field is $62 and you're applying a $3 credit, enter $59 in the Adjusted tax collected field.
- In the Comments field, note for your records what the adjustment was for (e.g., applying credits from previous return), and then click Adjust.