I have Quick Books Basic. Our small business sells clothing. Recently moved from Pennsylvania (where clothing is a non-taxable item) to Washington (where clothing is a taxable item) So inventory items were all entered in Pennsylvania as non-taxable. And now that we are in Washington they ought to be taxable.

1. Do we have to go into every item in inventory and change from non-taxable to taxable? If so, is there an EASY way to do that? Or, if not, what do we do instead?

2. If the items are being 'used' in an invoice, will Quick books allow me to change the taxation of the item?

On invoices, we did sell some non-clothing items, so in Pennsylvania I set up my CUSTOMERS as non-taxable if they were generally wholesale clients with resale numbers or out-of-state clients and thus no matter what item we sold to them it was not taxed.
I set up customers as taxable if they were retail buyers so that taxable inventory items would be taxed and non-taxable (clothing) inventory items would not be taxed.

3. So, if I change my items in inventory from non-taxable to taxable, will it affect the old Pennsylvania invoices? Will, for instance, a clothing sale to a retail customer now show as taxable and change the invoice somehow?

I have created 2 different accounts for PA sales taxes and WA Sales Taxes so I can see the sales taxes I collected within each state. We moved August 5th. All operations in PA are ended and all business is now conducted in WA.

4. Do I need to, or is there a way to 'close out' my books from PA so I can figure out what sales and expenses were made prior to Aug 5th for my PA income taxes and then open a new Washinton books for post-Aug 5th sales and expenses for my Washington Business taxes? --Or do I just run a report and modify the dates to get what I need and leave it all togther for year 2006?

Please, if you answer, try to hit each numbered question. THANKS!