Quickbooks for single member company that is also 50 percent owner of partnership LLC

CEOPTIMIZE · ‎March 23, 2021

Hi,

I have an LLC that is owned only by me (lets call it company A). I'm in the process of starting a 50% partnership LLC with someone (Company B). My 50% share is owned by Company A. I'm just now in the process of starting Quickbooks for both companies.

A few questions on this company structure:

1) Do I need to open two separate Quickbook accounts for these two companies?

2) I formed company A already and have been using the bank account of that company to pay for some of the startup costs of Company B. I will need to reimburse these expenses once our bank account is formed etc for Company B. Example: I paid for legal fees for company B with my Company A bank account. Do I classify the expense under Company A as legal fees, or as something else, as I will be reimbursing Company A?

Thanks!

Catherine_B · ‎March 24, 2021

Hello there, CEOPTIMIZE.

If both companies have separate VAT returns, you may need to sign up for another QuickBooks Online account. To reimburse the expenses, you can create an Equity account. For any transactions that relate to the partner company, you can use a Journal Entry.

Here's how to create an Equity account:

From the Accounting menu, select Chart of Accounts.
Select New at the upper-right.
In the Account Type drop-down, click Equity.
Under the Detail Type drop-down, select Owner's Equity or Partner's Equity depending on your situation.
Hit Save and Close.

Then, you can follow Step 1 in this article: Pay for business expenses with personal funds.

Feel free to use this reference in case you want to record the personal money you use to pay bills: Track personal money or investments to your business.

Keep me posted if there's anything else that you need help with. Take care!

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Quickbooks for single member company that is also 50 percent owner of partnership LLC

Quickbooks for single member company that is also 50 percent owner of partnership LLC

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