jkrueger,
If sales tax was not posted correctly on the invoice, I would void the invoice and repost it correctly. Voiding the invoice reverses the sales tax automatically.
If you are unable to void the invoice, then you can post a credit memo to the invoice and then manually verify the Tax Reporting amounts.
First, print the AR, Reports, Sales Tax Report for the date range of the invoice you are selecting to adjust to identify the taxable, non-taxable and sales tax charged. Use this report to make sure the tax reporting is reversed correctly.
When doing a Credit Memo to the sales tax, you will want to review the ‘Tax Reporting’ to verify how you want the taxable and non-taxable to be adjusted.
In reviewing the Tax Reporting, since a credit memo reduces an invoice balance, a positive number on this screen will be subtracted and a negative number will be added to the 'Taxable' and 'Non-taxable' fields.
Here are some Knowledge Base articles regarding sales tax for you to review.  (Articles can also be accessed by going to sagekb.com) :

How to correct the sales tax on an open invoice (97709)  https://support.na.sage.com/selfservice/viewdocument.do?externalID=97709

How to adjust sales tax on credit or debit memos (18242)  https://support.na.sage.com/selfservice/viewdocument.do?externalID=18242

How to interpret A/R credit or debit memo sales tax reporting distribution (18239)  https://support.na.sage.com/selfservice/viewdocument.do?externalID=18239

Sincerely,
Coleen

Thank you for your help Coleen!  

Hi jkrueger, if the above suggested answer helped, please do mark it as verified  (by clicking the "more" button on the response) for the benefit of others in this forum :). Thank you!

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Additionally if the sales tax has already been remitted to the state, etc as is often the case- I suggest returning the Invoice with todays date and then redoing the invoice correctly with todays date. This makes sure that the credit for the sales tax is included in the current month and you don’t mess up the sales from prior periods for audit purposes. 

I have found that this customer was billed another invoice with sales tax on it. That invoice was already paid, so I can not post the credit memo.  I also already paid the state the taxes.  How can I enter a credit for the sales tax? Would that be a journal entry?  We do a lot of work for the customer so I can issue him a credit for it on another invoice. I'm just not sure about how to get the credit in the system for us to take.  

Hope that makes sense.

Thank you

The system will allow you to do a Credit memo to a paid invoice.  When you post the invoice it will prompt "OPEN CREDIT OR CASH REFUND?"  At this point you can select Open credits.  Then the Open credit it available for you to apply to a future invoice.  (I believe the only limitation in our system would be if it is an older invoice and has been closed for more that 3 months. Otherwise, you should be fine).  To show in your current Sales Tax Report, same as above, you would want to use the current month date to see the credit in your current month sales tax report.    The only other option is to do the credit memo and select Open Credit (instead of the invoice #).  And proceed with your processing your credit from there.

Sincerely,

Coleen

Thank you!