Did everyone get the memo? QuickBooks Online will no longer support tags, and they’re making the change one week before the S-Corp and Partnership tax deadline.
While I appreciate the need for this kind of decision, I encourage Intuit to reconsider the timing of big changes so that they come between May and November. It’s not just tax pros that struggle with “busy season”… it’s also bookkeepers and CAS practices that have to tie out the annual financial statements in QBO to effectively hand off the books to tax pros — which y’all know is my passion when teaching and in our ‘Ask a CPA’ subscription.
As for the specifics — they are adding an additional custom field to most plans and are creating a tool to facilitate the migration from tags to this new custom field.
More from the announcement here —
What action do I need to take?
In February 2025, you and your clients will have the option to migrate all tags to a custom field. Watch for an email from the QuickBooks team in the first week of February. You and your clients will get access to a tool to facilitate the migration. However, you can also input the values, e.g. tags, into the custom field by hand or not transfer the tags at all, if you prefer. Additionally, be sure to download any tags reports so you have them for your records.
What deadlines should I be aware of if my clients are currently using Tags?
– Week of February 3, 2025 – Both you and your clients will receive an email notification. It will include a link to a tags → custom field migration tool and a how-to FAQ.
– March 8 – April 30, 2025 – You and your clients will have read-only access to existing tags, whereby you can view and generate reports for tagged transactions for your records.
– All Tags UI will be removed after May 1, 2025. You will no longer be able to run reports for tagged transactions.
A lot of people got really mad on social media when I posted about this, saying that it was a really useful feature and skewering Intuit for taking it away… but in reality, from a corporate standpoint, anyway — not enough folks are using it, partially because it’s underdeveloped and kind of buggy, and the reporting usage isn’t robust. As my friend Margie Remmers-Davis said, “either flesh this feature out or let it go”. So, personally — I’m actually on-board with it. EXCEPT for the lousy timing. Increasing the number of custom fields in the three lowest levels of subscription and creating a way to migrate from tags to the new custom field is a good way to facilitate this transition — but it’s going to take work to implement this, and we just don’t have time in Feb/March to make that happen. Beyond that, it’s been pointed out by other colleagues that changing reporting mid-year is really challenging, and that this should have been timed to coincide with next January 1st.
The always-amazing Alicia Katz-Pollock had this to say about it in the QB Power Users Community:
The rest of the comments on this particular post are truly worth reading, in my opinion, as you can get some good insight as to how the folks who do depend on tags are using them — for example, Dena Martin and Megan Tarnow talked about why they use them for event-tracking for non-profits, so they don’t muck up the financial statements — and what workarounds they’re considering. Custom fields are not likely to handle this well. Projects may, but that’s a lot of work to set up and maintain.
There are also folks who are going to be severely limited by the fact that only one custom field is being added. Comparatively, QBO Essentials allotted unlimited tags and 40 tag groups. The new arrangement takes it down to only four custom fields. Several clients are going to be forced to a Plus subscription to use classes — or in some cases, come up with an external workaround. It was pointed out that QBO Advanced clients who are already using classes for other purposes and were using Tags as well are out of luck if using Projects won’t solve the issue. Each client is different, so if you’re a bookkeeper or accountant with clients in this situation, please hit that Feedback button in QBOA and let them know your concerns. And if you aren’t already following the thread I mentioned above on Facebook… it’s definitely worth your time.
Ah, QuickBooks — you giveth and you taketh away. Merry Christmas and Happy Hanukkah!
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