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Experienced Member

PayPal Credit Transaction

Perhaps I am overthinking this, but as a new user to QB I want to verify before continuing with future transactions. 

 

I have connected PayPal to QB and setup PayPal bank, I have made an online purchase of a supplies and materials expense, I paid for this purchase via Paypal Credit totaling $50.37.

 

QB imported the transaction of me receiving $50.37 as income from Paypal, and $50.37 of supplies and materials expense. 

 

-I am confused on how to properly categorize these so I am not taxing the $50.37 as taxable income, as well as categorizing it as a debt owed at a later date and not income.

-I am also confused on how to properly categorize the expense it records to reflect the PayPal Credit as being used, and not an expense taken from income. 

 

 My main concern is improperly setting the categories and what they affect on the back end when it comes time to generate reports and taxes. Thank you for your help!

2 Comments
Established Community Backer ***

Re: PayPal Credit Transaction

Where did the paypal credit come from? If that credit is something like a cash back reward, then yes it is income to you.

in your attachment it looks like the expense is posting to paypal fees and not the supplies expense account

QuickBooks Team

Re: PayPal Credit Transaction

Thanks for visiting the Community, thearcwerx.

 

I agree with what Rustler mentioned. In addition, if this Paypal Credit works like a credit card, you can record it as an expense. You'll need to exclude it first from your downloaded transaction. Then, record it manually as an expense.

 

To exclude it:

  1. From the Banking page, select the For Review tab.
  2. Select the checkboxes of the transactions to exclude.
  3. From the Batch actions drop-down, choose Exclude Selected.

To record an expense transaction, you can follow this article: How to enter expenses.

 

If you have other questions about downloaded transactions, please let me know.