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The SBA made the monthly payments on one of my loans during the Pandemic. How do I show the payment was made and book the SBA payments as income?

 
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QuickBooks Team

The SBA made the monthly payments on one of my loans during the Pandemic. How do I show the payment was made and book the SBA payments as income?

I can help you in recording the loan payment, @krisamjohnso. 

 

You'll have to set up a liability account, then record the amount you got from the loan. Loan accounts can be an asset account or a long term liability account. However, it's best to work with your accountant to know the best methods used.

 

Here's how:

  1. Go to the Accounting tab, then select Chart of Accounts.
  2. Click the New button to create a new account.
  3. From the Account Type drop-down list, select whether it's a Long Term Liabilities if you plan to pay off the loan by the end of the current fiscal year or Other Current Liabilities instead if it's payable in a short period.
  4. Choose details that matches your loan in the Detail Type drop-down.
  5. Add all the necessary information.
  6. Click Save and close.

Once done, record your loan by creating a journal entry. Here's how:

  1. Go to +New and select Journal entry.
  2. On the first line, select liability account under Account column. Enter the loan amount in the Credits column.
  3. On the second line, choose the asset account or the appropriate account. Enter the loan amount in the Debits column.
  4. Click Save and close.

After that, record your loan payment by creating an expense or a check.

  1. Go to +New and select Check.
  2. Enter the following information below:
    1. First line: Liability account for the loan and the amount of payment.
    2. Second Line: Expense account for the interest and the amount.
    3. Additional lines: Any additional fees along with the appropriate accounts.
  3. Click Save and close.

You can learn more about recording loan payments through these articles:

Let me know in the reply section if you need further assistance in recording the loan payment. I'm always here to lend a hand. Have an awesome day ahead.

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