How do I track an employee paying back a loan made by employer?

Forum|Forum|7 years ago
February 15, 2019
1 reply
11 views

My boss made a loan to an employee which is to be paid back a little each check. The employee is a 1099 "employee", if that makes a difference.
I have been told to record a negative loan payable. Would this be correct?
When I tried this, QB said that I had to turn on Expense Tracking (which I can't find). But that doesn't really make sense to me bc it's not an expense.

QuickBooks Online

maxyness

First Set up a Liability Account (Other Current Liabilities) for the amount of the loan given.

Then when you pay the Contractor (1099 recipients are not employees)-use the liability account and enter a negative amount.

Example:

Write check for contractor Joe Blow:

Amount of check is $500.00

Account-Contract Labor would be $500.00

Account-Joe's Loan would be -$50.00

Net amount of check would be $450.00

qbteachmt

Level 11

There is no Liability here.

You give a loan = your Other Current Asset.

There is no such thing as "1099 employee." You are describing a Vendor.

The original payout is entered as Other Current Asset.

The repayments are deposited to bank as "Other Current Asset" repayments.

maxyness

You are totally correct! The loan would be an Asset... I was thinking of something else...lol

So sorry!

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