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Level 2

What Category do I use for Transferring Money to a Personal Checking Account

My boss sometimes transfers money from his business account to his personal account. How do I categorize that? 

3 Comments
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Level 15

What Category do I use for Transferring Money to a Personal Checking Account

If you are taxed as a sole proprietor or partnership[ it is equity draw

For a company taxed as a sole proprietor (schedule C) or partnership (form 1065), I recommend you have the following for owner/partner equity accounts  (one set for each partner if a partnership)

[name] Equity (do not post to this account it is a summing account)
>> Equity
>> Equity Drawing - you record value you take from the business here
>> Equity Investment - record value you put into the business here

 

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Level 1

What Category do I use for Transferring Money to a Personal Checking Account

can you walk me through the steps to setup an equity account?

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QuickBooks Team

What Category do I use for Transferring Money to a Personal Checking Account

Good day, @RockyMountain,

 

I'd be glad to walk you through creating an equity account.

 

Make sure you've already set up the owner or partner as a vendor, so you can track the transactions associated with him/her.

 

Here are the steps you can follow:

  1. Click the Gear icon at the top right of the page.
  2. Select Chart of Accounts under Your Company.
  3. Click the New button. createOE1.PNG
  4. Select Equity under the Account Type section.
  5. Select Owner's Equity under the Detail Type section.
  6. Enter the Name of the account, then click Save and ClosecreateOE2.PNG

If you need to set up equity accounts for multiple owners, you can read through this article for the detailed steps: How to set up owners or partners.


That's it for now @RockyMountain. If there's anything else you need, don't hesitate to leave a comment below. I'd be here for you.

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