cancel
Showing results for 
Search instead for 
Did you mean: 
QB-Learner
Level 1

How to deposit money to owners equity?

I skimmed through some info from the forums but am still confused.

I have a business account (Bank Type) this is where all payments/deposits go.

Now, from time to time there is not enough funds in my business account and I have to pull out of personal money to be able to make a transaction.

How do I deposit or put my personal money into Owners Equity? that will in turn be able to deposit into my Business account? And can QB track how much you have put into the business from personal funds?

Thanks in advance.
Solved
Best answer December 10, 2018

Best Answers
Rustler
Level 15

How to deposit money to owners equity?

I recommend you have the following for owner equity accounts
owner equity
owner equity drawing - you record value you take from the business here
owner equity investment - record value you put into the business here

So you make a deposit in the bank account and use owner equity investment as the source account for the deposit.

I have a step by step targeted tutorial on equity, see this posting if you are interested
http://onsale-apparel.com/Rustler/my-tutorials

View solution in original post

11 Comments
Rustler
Level 15

How to deposit money to owners equity?

I recommend you have the following for owner equity accounts
owner equity
owner equity drawing - you record value you take from the business here
owner equity investment - record value you put into the business here

So you make a deposit in the bank account and use owner equity investment as the source account for the deposit.

I have a step by step targeted tutorial on equity, see this posting if you are interested
http://onsale-apparel.com/Rustler/my-tutorials

View solution in original post

jdm7dv
Level 1

How to deposit money to owners equity?

Is this answer legal?
qbteachmt
Level 15

How to deposit money to owners equity?

@jdm7dv Sure, it is legal to make a deposit as Equity, for the sole proprietorship that is Owner, who funds their business bank account from personal funds. It is not how to track Funds provided to an LLC or Corporation. For those entity types, you might have a Loan scenario; it is Not Right in the tax regulations for a Single-member LLC or Sole Proprietorship to consider your business is in debt to/from yourself.
tphaeulz
Level 1

How to deposit money to owners equity?

What if the cash wasn't deposited? How do I show that the cash spent (money from client) was owner payment?

qbteachmt
Level 15

How to deposit money to owners equity?

When the owner keeps funds from customer payments, you still need to process it as Sales. Then, in the Banking deposit window, you can can show "cash went to Owner Equity" and that would be a Negative (for QBO) or, for QB Desktop, it's a provided entry at the bottom of the Make Deposit screen. Please see my attachment.

tphaeulz
Level 1

How to deposit money to owners equity?

Thanks

DA6160
Level 2

How to deposit money to owners equity?

Very legal, you are just categorizing the transaction to select funds in our out, and how. Everything else the CPA determines. Good luck.

quinn1
Level 3

How to deposit money to owners equity?

I categorized a cash deposit from my bank feed as owners equity investment. It shows in that account in my chart of accounts, however, when I reconcile for that statement period it shows a discrepency of that amount. Is this amount to be posted to another account or something?

kmasta
Level 3

How to deposit money to owners equity?

oops I posted twice

kmasta
Level 3

How to deposit money to owners equity?

Hi thank you for your answer it helped me ~ I just wanted to find out if I am supposed to close out Owners Equity Investment at the end of each year or if it just keeps growing indefinitely as I continue to make personal contributions to my business (which I will do because I am a sole proprietor).  Thank you.

MirriamM
Moderator

How to deposit money to owners equity?

It's good to see you in this thread, @kmasta.

 

I'm happy to hear that the information above helped you. This time, let me share information about how the owner's equity works at the end of the year.

 

At the beginning of the new year, QuickBooks closes all expenses and income accounts to retained earnings unless you are set up in the system as a Sole Proprietorship since it will close to Owner's equity.

 

The owner's draw investment and retained earnings should also be closed to owner's equity at the start of the year. That way, during the beginning of the year, you can easily see what you have taken or invested in the business. 

 

Additionally, QuickBooks makes year-end adjustments automatically based on your fiscal year start month. To know more about this, take a look at this article: Close your books in QuickBooks Desktop.

 

In case you need tips and related articles in the future about the "How Do I" steps in QuickBooks Desktop, visit our QuickBooks Community help website for reference: QBDT Self-help.

 

If you have any other questions concerning QuickBooks Desktop, please let me know. I'd be happy to answer it for you. Take care.

Sign in for the best experience
Ask questions, get answers, and join our large community of QuickBooks users.
Sign In / Sign Up

Need to get in touch?

Contact us