The “Tags” tool is a default feature available in QBO, there is no need to activate it separately. The Tags feature in QBO provides customizable labels you can easily assign to various transactions (invoices, expenses, and bills). Best of all, there is no additional cost for using this feature.
Some key Tags features :
- Availability: This feature is available in all QBO versions starting from QBO Essential.
- Usage Limit: Currently, 300 tags and 40 tag groups can be created in QBO. This usage limit is currently uniform in all QBO versions.
- To track expenses/income related to one particular job/project/employee/event and so on. Since QBO Essential do have the option to track projects or class/location features, this tool will be useful instead.
- You can use tags in sales invoices, expenses, bills, and deposits.
- Tags cannot be used in journal entries.
- After adding tags to your transactions, you can get custom reports as per the tags applied by you.
Making the most out of Tags feature in QBO
How and where can you create Tags or Tag groups?
- Under Banking Tab > Tags > New
- Or simply as shown in the screenshot below:
Where you can access the Tags:
- By clicking on the Gear icon, it’s listed below the Lists column:
- Under the Banking Tab:
How can you get the custom reports as per tags?
The following is a scenario in which jobs are being tracked for a Construction business client. In a construction business, individual projects are broken down to job schedules and it often helps to track them as per their billing and progress.
As you can see in the screenshot below, the tags are listed and the transaction number under each and every tag is listed.
- Now simply click on the ‘Run report’, Make sure to select the appropriate dates. In this scenario, we have selected all dates as the expenses for this Job were incurred over several months.
So why did we use the Tags feature?
- The client wants us to track the income and expenses for every job.
- The Classes feature or a feature known as Project could have been used, but those features are available only in QBO Plus and QBO Advance versions.
- As we are using QBO Essential version for this client, we opted for tags, since this feature is available in all versions of QBO.
How were we able to provide the reports as per client requirements?
- We created tags as per the job name and applied those to all the transactions related to that job, be it income, expenses, invoices, etc. Pls note, *Tags cannot be used for journal entries.
- Hence all the transactions were listed under that particular tag and custom reports were generated .
What was the benefit to the client?
- On-demand reports available to pull anytime
- Gets the job done with QBO essential version
- No need of an upgrade to QBO Plus
There are many other creative usages of Tags – it’s a welcome addition to QuickBooks Online. Its versatility allows business owners and accounting & bookkeeping professionals to analyze their business activity easily and comfortable. With such efficiency, there is no interruption to the company’s financial structure.
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