End of year disbursements

Gabalot · ‎August 29, 2022

Hello,

I am doing bookkeeping work for a company that makes quarterly disbursements to is partners. For 2021 4th quarter disbursements, the checks were cashed in 2022. Do I include those in 2022 even though they were for 2021? If not, how would that work with the bank reconciliation if the money was taken out of the bank account in Jan 2022? I am using the accrual method (although sometimes think the cash method might be better)

also, would you include those disbursements in 1099s??

Thank you!!!

Rustler · ‎August 31, 2022

Well that is one of many problems with all this automation, the date of the bank clearing is just not the right one. I would open the register, find the check and change the date.

Yes it should be done so transactions support your tax reporting

View solution in original post

Rustler · ‎August 30, 2022

The date on the check is the date of the disbursement, so that is easy.
Whether the check is cashed this year or next makes no difference to the accounting.
A bank recon is just a way to match the transactions that the bank has against the entries in QB. That the check has not cleared the bank just means it is open until the next recon. No big deal.

Cash or accrual does nothing concerning any of these issues, and in truth QB does not do true cash accounting.
A partner, or an owner in an s-corp never gets a 1099. (unless they own a business that is different and are a vendor for some reason)

Gabalot · ‎August 30, 2022

Ok thank you for your reply!

because I have linked my bank account linked to QuickBooks, the check only comes through as an expense when it’s cashed, on January. So is there a way to change the date to the date of the check, December? Or should I even?

Rustler · ‎August 31, 2022

Well that is one of many problems with all this automation, the date of the bank clearing is just not the right one. I would open the register, find the check and change the date.

Yes it should be done so transactions support your tax reporting

Gabalot · ‎September 10, 2022

Ok thank you!

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End of year disbursements