Thank you for sending the screenshot, circletax1. I appreciate you providing that visual so we can better understand your concern with the sales tax calculation.

To summarize, QuickBooks Online calculates sales tax for each transaction based on the following parameters:

• The customer's tax exemption status
• The shipping and selling locations
• The type of product or service sold

If everything is set up correctly, the markup item is automatically taxable.

To get more insight into why the sales tax is showing as $356.61 for this invoice, click the See the math link under the sales tax amount. This will break down the full calculation including the agency tax rates and the taxable amount. 

On the same window, you will see a separate line for markup and its sales tax amount. It will also give you the option to override the sales tax amount. 

Let me share these articles with more information on how QuickBooks Online calculates and handles sales tax:

• Learn How QuickBooks Online Calculates Sales Tax
• Override Sales Tax On Transactions In QuickBooks Online

I'd be on the lookout in case you have follow-up questions, circletax1. You can also visit us again anytime you need anything when recording sales and other transactions. I'd be happy to help or point you toward useful resources related to QuickBooks Online.