my year in profits go into undistributed income in QB. We are a S crop and have two owners at 50/50. I know that these dollars are taxed already. Can I leave them in this account or do i need to put the fund in a equity account for each of the owners. What is the general accounting practice on this.
You don't need to do anything. QB automatically places the profit into "income" which is an equity account. At the end of year QB puts all the income into retained earnings account. If the profits are devided 50 50, why bother with transactions. Unless the partners make uneven drawings, han create 2 draw account for each owner as equity accounts, to keep track of their draws.