Jasin - Are you in New York State?

Yes, Elmira NY

We book the gross amount to the GL for Materials and the job then we book the Sales Tax amount to our Sales Tax Payable account.

This causes the Sales Tax account to be debited, deducting the amount from Sales Tax to be paid. We keep track by doing an excel spreadsheet and add said spreadsheet as an attachment to our Sales Tax Return online. On the Sales Tax Return you have to enter the amount of the Sales you're deducting and it calculates the Sales Tax but we enter both figures on our Credit spreadsheet. This helps to double check your figures also.  Does this help? If it doesn't then explain what you do.

Jasin, Same issue here in Washington State. Our fix is similar to CindyL's. Incredibly time consuming and would LOVE for Sage to come up with a fix. Unbelievable that there isn't one yet.

I believe we handled it similar, but in quickbooks we had to make a manual transaction from one account to another of non-taxable amounts we paid tax on to keep our total sales correct. If I understand you correctly this can be handled automatically in Sage if I set it up correctly. 

I'm learning the hard way, head first in to the flames

Sage 100 Contractor now has the ability to add "use tax" to vendor payables that will automatically charge the same account (job materials) and then credit the sales tax payable account.  or you can designate specific accounts to be affected.  Look at menu 1-8 Posting accounts.  But it sounds like you only want to charge the job the pretax amount and then a new contra liability account called "sales tax paid".  If you use the use tax feature there is a use tax report at menu 4-1-7.  Try setting it up in a play data set to make sure you get the results you want, or even the Sage Sample Co

Agree that the "Use Tax" in Sage100 is super helpful, but that is only half of the equation. Sage really needs to provide the ability to track BOTH Use Tax and Sales Tx Paid @ Source. They go hand in hand and need to be tracked separately

"But it sounds like you only want to charge the job the pretax amount and then a new contra liability account called "sales tax paid".

Yes this is exactly what I want. Not sure how to get it setup correctly. Then if I can get a report on the amount of tax I paid that shouldn't have been taxable I have the information I need file my ST-101

The problem I see with Use Tax is when you run Job Cost the Use Tax is taken into account. I don't want the Use Tax in the job cost report 6-1-2

Then don't job cost the tax portion.  Book it to prepaid sales tax and deducted it when you file

We have some tax-exempt jobs and we have a separate cost-code for ALL jobs strictly for tax, with your problem being exactly one of the reasons why we code tax separately.  I can pull a job cost report for a tax-exempt job and see where we accidentally paid sales tax so that I can pull the invoice as backup and take the credit against my State's sales tax report.