Tax & Accounting Blog

Working with Custom Tax Codes in Accounting CS

CS Professional Suite Accounting & Auditing Solutions January 7, 2014

Custom tax codes enable you to group expenses together in Accounting CS. This enables you to easily export these amounts as a group to UltraTax CS. It also gives you more control over the appearance of reports. Let’s look at an example that shows how custom tax codes can help you provide better reports to your client while saving time.

A client has several utilities and insurance expense accounts set up in their chart of accounts. The expenses for these accounts all fall under tax code 213 (1120, Other Deductions). However, your firm would like to group these expenses as two separate items (utilities and insurance) within the tax form schedules.

You can solve this problem by creating two custom tax codes: 213-1, “Utilities” and 213-2, “Insurance.” This will give you the summary information you need in your tax export and related tax reports.

Here’s how the Setup > Tax Code screen would appear in this scenario:

Accounting CS Tax Code screen

Here’s how the resulting UltraTax CS statement would appear on the L26 statement:

UltraTax CS L26 statement

How to Add a Custom Tax Code for a Single Client

  1. Choose Setup > Tax Codes, select the appropriate client from the client selection field, and click the Add button.
  2. Select the appropriate tax code, then enter a one or two-digit alphanumeric character in the Subcode field.
  3. If applicable, enter a description for the custom tax code.
  4. Click Enter to add the custom tax code for the client.

How to Add a Custom Tax Code for All Clients

  1. Choose Setup > Firm Information > Firm Tax Codes.
  2. Select the entity type and tax code from the appropriate fields.
  3. Enter a one or two-digit alphanumeric character in the Subcode field.
  4. If applicable, enter a description for the custom tax code.
  5. Click Enter to add the custom tax code for the firm.


  • Accounting CS now enables you to assign tax codes to multiple accounts at once in the Chart of Accounts screen or the Enter Trial Balance Screen. You’ll find detailed instructions here.
  • When you add a custom tax code for all clients, it will apply to all newly-created clients from that point forward. It will not be automatically applied to all existing clients. To add a custom tax code for an existing client, follow the stops to add a custom tax code for a single client.
  • You cannot delete a custom tax code if it has been assigned to an account or another entity. The application will prompt you if you attempt to delete an item that cannot be deleted.
  • You can add custom tax codes for the selected client on the fly in the Setup > Chart of Accounts screen.
  • The description that you enter for a custom tax code will appear on the UltraTax CS statement.

Importing Balances Using Regular Tax Codes Vs. Custom Tax Codes

When you import balances that use a regular tax code, UltraTax CS offers a choice between importing detail or summary tax code information, as shown:

Accounting CS Import Tax Code screen

Let’s look at how the choice between detail and summary affects the import of two expense accounts assigned to regular tax code 213.

Selecting “Detail” tax code information shows the two accounts separately on the L26 statement, as shown:

UltraTax CS L26 Detail statement

Selecting “Summary” tax code information groups the two accounts together under one of the account names, as shown:

UltraTax CS L26 Summary statement

You can use a custom tax code in this situation to provide more control over how the imported balances appear on the L26 statement. If both accounts use the custom tax code called Utilities, the L26 will appear as shown:

UltraTax CS L26 Custom statement