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Join nowThis is my first time setting up a loan in quickbooks. I have a loan through the Payroll Protection Program that I need to enter in QB. Assuming the entire loan is forgiven at the end, how will I account for this? Is there a special entry or procedure for "loan forgiveness" to clear the loan? All I see is how to make payments toward the loan. Thanks.
Good afternoon, RG777.
I'm more than happy to help you set up the PPP loan in QuickBooks. I'm going to provide a link for you, with a very detailed break down of the set up process.
- Set up a loan in QuickBooks Online
Here is a quick snapshot of those steps:
You also mention the load being forgiven. Yes, the loan may be forgiven if you use the funds as directed by the SBA, including but not limited to, meeting the following criteria:
Should you be unable to meet those requirements for forgiveness, you can still be eligible to have what you owe on your loan reduced. The total forgivable amount may be proportionally reduced as a result of:
Keep an eye on this article, it's update regularly and is a one-stop-shop for everything about the Payroll Protection Program.
If you need help with anything else, feel free to post here.
Thank you for your patience and have a wonderful evening.
How about setting it up on desktop? I had the bank transfer the money into a savings account so that I could track and make sure we only used it for payroll expenses. I set up a long term liability account for the PPP. Do I do a transfer from PPP to my Savings? (If I do it that way, it'll deplete the balance for the loan under the PPP account?) Can you help me make sure I set this up correctly?
TIA
Good work for setting up the PPP liability account, Angie R. Let me help you make sure it's set up correctly.
You don't have to transfer the money from PPP to Savings. You'll just have to make a deposit using the liability account. This will not deplete the loan balance. The balance will only be deducted once you make payment.
Here's how you can make a deposit:
This process will add the money to both savings and PPP accounts. Although, if you've added an amount while creating the liability account, the figure will be doubled. You'll have to delete the beginning balance. This way, it will only show the deposited transaction. Here's how:
For more information, you can check this article on how to manually track loans.
If there's anything else that you need, you can tag me. I'll reply as soon as I can.
Thanks for the info! That worked!!
Hey there, @Angie R.
I'm so glad that we were able to provide you with some information to help you resolve your question. The Community is always here to have your back.
Should you need any further assistance, just let me know. Bye for now!
Question on entries for the Payroll protection Loan. So first you would enter the funds as a loan, correct? then we were allocating 75% of the loan for payroll. We put 75% in our payroll account at our bank so would I show that in QB in our payroll balance on QB? For the other 25% we are using to pay rents, interest payments etc. and we just put that 25% into our main operating account. What is the best way keep track of using those funds and knowing that are being deducted from the "PPP fund" example paying a rent payment would I enter that bill and do something within that bill to notate it was for the PPP?
Then for payroll would it just be known that during this time those funds were for that?
Thanks! I think I'm really over thinking it and just need someone to dumb it down for me
Carly
Thanks for reaching out to the Community, @carlyl.
At this time, we're currently working a solution with integrating the Paycheck Protection Program into all of the QuickBooks products. I appreciate your patience as we work to support you.
You can keep an eye on our What you need to know about the Paycheck Protection Program article for any important updates, such as how to record the loan transactions.
Feel free to comment below if you have any more questions or concerns. Have a good rest of your day!
When it is time to Eliminate the PPP Loan ( current liability) from the Balance Sheet, I Debit the PPP Loan Liability and Credit what ? Some have said " Other Income" PPP Forgiveness some have a an Equity account. If an Equity Account what is the Account Name. We are a Sub S Corp
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