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Paypal account & paypal connected Bank Account both imported to Quickbooks Self Employed

We survive off of a combination of our joint income (married, both employed) and my self employed work (which keeps us above water by working weekends & nights).  So I have been mixing funds (income and spending) between my Paypal account, which was originally primarily for business, and our personal bank account.  This isn't that difficult, I can track everything in a spreadsheet AND on paper and tend to know my balances daily to the penny.  However I'm finding myself shorter on time and interested in moving to Quickbooks Self Employed, especially as I'm interested in growing my personal business to become self employed again.

 

With that in mind, I have added both Paypal and my primary Bank account. 

 

The issue comes when Paypal draws off of our bank account, whether for a business or personal expense paid with my Paypal Debit card.  The original Paypal transaction (either via Paypal itself, or drawn on the business Debit Card connected to Paypal) will show the full transaction information.  So it makes sense to differentiate the transaction as personal or business at this point, and further categorize (Income, type of expense, etc) it from there.  

 

However on the bank side, when funds are drawn to cover a paypal transaction, I of course have duplicate transactions shown as just "Paypal - Standard Checking".   So my question is, should I also list this as a 'transfer', or should I simply exclude these charges altogether?  Asking before I commit to editing my bank account transfers, so that I don't have to remove the account and try again to keep actual income & spending totals correct.

 

Thanks!

Solved
Best answer 09-18-2019

Accepted Solutions
QuickBooks Team

Re: Paypal account connected to Bank Account

Thank you for the additional details, mbroadstreet.

 

On the PayPal side, you can categorize the business transactions as income or expense. Then, on the bank's side, you can mark the transferred PayPal entries as Transfer. Please check out this article for more details: Transfers between accounts in QuickBooks Self-Employed. The Income to connected accounts section. 

 

Please feel free to go back to this thread if you have other questions.

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3 Comments
QuickBooks Team

Re: Paypal account connected to Bank Account

Hi mbroadstreet,


Sorry to hear about your child. I hope you’re doing well after all the circumstances you’ve had. Well, you displayed a positive outlook based on how you wrote your post though.


Yes, you can create a rule. However, we have no control over the description of your transactions. There’s a tendency that a transaction with “PayPal - Standard Checking” description will be categorized as Transfer even if it isn’t supposed to be categorized that way. I will leave it to your discretion.

 

If there’s something you would like to know in the future, you can click on Help at the top right hand corner. Then, search for it, or you can visit us back in the Community. We’ll be happy to lend you a hand.

Level 1

Re: Paypal account connected to Bank Account

Hi JessT, thanks for the response.


I think the reason I'm asking this for the community, is because I'm wondering which approach is better: rule or exclusion, from the perspective of someone who is using a bank connected to a paypal account, and tracks both within Quickbooks as well.

 

The transactions in Paypal itself (when connected as a bank) appear first as a debit from Paypal.  When there's no balance, then of course they appear also as a transfer of funds (from the bank) from within paypal.  Since I'm categorizing the initial transaction, that already reflects as a positive or negative on my overall balance, and the transactions marked as transfer have no effect.


So on the bank side, is it better to also mark the ACH transactions to paypal as transfers, or simply exclude them?  I'm asking because a good % of my bank transactions have to be manually imported, and I already ran through this process once and came up with balances that didn't add up correctly.  Hopefully someone can speak from experience =]

QuickBooks Team

Re: Paypal account connected to Bank Account

Thank you for the additional details, mbroadstreet.

 

On the PayPal side, you can categorize the business transactions as income or expense. Then, on the bank's side, you can mark the transferred PayPal entries as Transfer. Please check out this article for more details: Transfers between accounts in QuickBooks Self-Employed. The Income to connected accounts section. 

 

Please feel free to go back to this thread if you have other questions.

View solution in original post

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