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bkauffman
Level 1

Best way to Move PPP Loan from Business Checking to new checking account in QBO

Looking for the best way to do this in QBO.  We received our PPP loan Deposit in our Business Checking Account on Monday 5/4, it is currently not reviewed or allocated in quickbooks online.    Finally today our bank opened a separate checking account for these funds to help create an audit trail for forgiveness.  I transferred the funds in our bank (PNC) from our main checking account to the PPP Checking account.  What is the best process to record this properly in Quickbooks.  

 

So far I have created a Long Term Liability Account called PPP Loan.  My thought was to create a Deposit of the loan funds in the new PPP Checking Account.  However, would this cause a problem with reconciliation since the funds were first deposited in our main checking account and then transferred to the new PPP account?   Does this need to be accounted for or can I just continue with my plan of creating a new Deposit into the PPP Checking account?

1 Comment 1
Rustler
Level 15

Best way to Move PPP Loan from Business Checking to new checking account in QBO

Make a new bank account in the chart of accounts
use transfer to move money from one to another

the original deposit should be a deposit to the bank, and the source account for the deposit is the liability account you set up for the PPP loan.

 

if at tax time the money is indeed tax free, do a journal entry
debit the loan liability account
credit an income account created under other income named tax free (covid) income

 

 

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