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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

 
87 Comments 87
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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Following as I have plenty of clients asking how to do this now that proceeds are arriving or are imminent. I've thought about setting up a "bank" and a "credit card" account type to track expenses and/or enter JEs but cannot wrap my head around how to make it all work when setting up the liability accounts. I have clients with both PPP and EIDL loans/grants.  Right now, I am leaning towards suggesting that clients keep track of their expenses outside of QB via Excel until we can record entries after-the-fact. I feel like we should be able to do this inside QB though.

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Hi

 

We just got our PPP loan and I have the same question.  I am thinking I will create a sub account to my bank account and call it PPP expenses.  Then whenever I do payroll or pay rent etc, I will apply it to the bank sub account instead of the parent bank account.  This is just a thought and I would welcome any feedback.

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Not sure if this is the best way but I have set up expense accounts such as: PPP Expenses, then sub accounts under PPP Exp. for electricity, rent internet, phone, etc... When entering those bills during the 8 weeks, put in these lines. Then at the end of the 8 weeks you can pull your P&L report for those specific dates. In regards to payroll, I have left as is and will pull payroll summary for the 8 weeks you have to spend your funds.  Look forward to hearing how others are doing this...

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Not sure if this is the best way but I have set up expense accounts such as: PPP Expenses, then sub accounts under PPP Exp. for electricity, rent internet, phone, etc... When entering those bills during the 8 weeks, put in these lines. Then at the end of the 8 weeks you can pull your P&L report for those specific dates. In regards to payroll, I have left as is and will pull payroll summary for those specific dates.

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I considered upgrading & setting up a "Location" as PPP expenses.  Other thoughts?  Also, trying to figure out how to separate >$100,000 pay in payroll expenses without having to do it manually.

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I was gong through many conversation and did not get any straight forward answer from any on QBO Team members anywhere.

Can we set up PPP as a "Project" in QBO and track Money from PPP Loan and expenses there? And then record the amount that is not forgiven as loan after 8 weeks in the books? Any thoughts on this methods?

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I was gong through many conversation and did not get any straight forward answer from any on QBO Team members anywhere.

Can we set up PPP as a "Project" in QBO and track Money from PPP Loan and expenses there? And then record the amount that is not forgiven as loan after 8 weeks in the books? Any thoughts on this methods?

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QuickBooks Team

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Hello, everyone. 

 

I'm here to show you how we can track the Payroll Protection Program (PPP) loan in QuickBooks Online.

We'll have to set up a liability account where we can record the loan. You can set up a short-term liability if you know it'll be forgiven otherwise, you can select the long term liability. You can refer to this article for more details: Set up a loan in QuickBooks Online.

 

You can also read these articles for more details:

I'll be here if you need more clarification. Have a great day and stay safe!

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I've set up the PPP loan as a long-term liability. Can someone walk me through the steps for how to record expenses incurred from here. For example, when I run payroll or pay rent (from the checking account), how do I record that against the PPP liability? Thank you. I'm using QBO.

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Using QB Desktop for a non-profit and using Classes extensively...

 

How I will account for the forgiveness would be to mark all allowable expenses with a project or location flag during the 8 week period.  Since the entity is on a cash basis, the expenses will be recorded on the payment date.  For instance if the loan is received on April 18, then expense paid for the next 8 weeks, through June 13, are used in the forgiveness calculation.

 

I will record the loan as a long term liability since it's payable over a 2 year period.  Debit cash (or repository account) and Credit long term liability account.

 

Using the project reporting each month I'll determine the allowable costs.  Apply the total from the project report as revenue to a loan forgiveness account and reduce the amount of the loan.  I may set up a sub account for the forgiveness amount under the loan account.  When I make each forgiveness journal entry, I will attach the report of expenditures for that period to the journal entry.

 

At least that's my plan.

 

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Need to know how to handle this in Desktop

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Need to know how to do it in Desktop Enterprise Contractors 19.0

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I am planning on setting up a class and leaving all of my expenses alone.

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

How do we account for each of the expenses incurred through the short-term loan?  

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

If the company file is not using Classes - wouldn't setting up a PPP class be a simple way to accumulate the expenses related to the use of the funds?  Initial entry - Dr. Cash Cr. Loan Payable.  Checks are written and charged to the appropriate expense account and to the "PPP Class" set up.  (Dr. Expense (Payroll, utilities, rent/interest) assigned to PPP class, Cr. Cash)  The expenses accumulate under the PPP Class, reports can be generated by class and those expenses are remitted for forgiveness.  When forgiveness is granted, Dr. Loan Payable Cr. Other income - loan forgiveness (PPP Class).  This would allow the Company expenses to remain "intact" in total for comparative purposes (payroll, utilities, rent/interest) yet the expense isn't deducted for tax purposes due to the offset of the loan forgiveness included as other income.  When this is all over, the class is set to "inactive" and the chart of accounts remains the same.

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I have created these videos to offer some suggestions on tracking PPP expenses, loan proceeds, and potential forgiveness:

- For QuickBooks Pro/Premier - https://www.youtube.com/watch?v=9z5EhPZLG7c

- For QBO - https://www.youtube.com/watch?v=EzBSDzRX0TA

 

Hope you find them to be helpful.

Scott Gregory
Bottom Line Accounting Solutions 

 

 

 

 

 

NOTE: To see how this is done in QBO (QuickBooks Online), visit: https://youtu.be/EzBSDzRX0TA This video shares some ideas for you to consider on how you can...
NOTE: To see this process in QuickBooks Pro/Premier, visit: https://www.youtube.com/watch?v=9z5EhPZLG7c This video shares some ideas for you to consider on h...
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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

@Rakk80 that would work unless you have to track expenses that are actually being worked on a specific project and needs to be tracked for that project. Another problem with that is if you're doing it in the payroll window, it will track ALL the payroll items to the project when not all payroll items are eligible for loan forgiveness (for example, you might be reimbursing an employee for a business expense such as cell phone or hotel travel expenses on that paycheck. Those items will be cost coded to the project as well, but they aren't eligible for loan forgiveness).

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Once again a "canned" response from Quickbooks that doesn't address the question.......SMH

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Thank you, both videos were great! One of my clients does not want their funds added to their operating account so funds are not accidentally used for vendor payments. In this situation, I think I would need to transfer funds from the liability to the operating account as they are being used. Any ideas?

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I think that if you really don't want the cash applied to current vendor payments, you need to put it into another bank account.  Otherwise an authorized party can write checks against the money in an "operating" or checking account.  

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Scott,

This is a good start but you don't take us all the way.

First, why create all the sub classes?  Why not just one PPP class? It will on the applicable report when filtered on that class. It could be great...but...

Second,and most  importantly, QBooks does not allow much creativity for splitting out the payroll expenses among different classes. So, the employer federal payroll taxes are not allowable payroll expenses  but the state unemployment taxes are. 

This would be beautiful if we could select which amounts on the paycheck to class as PPP.   Do you have a simple suggestion?

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Level 2

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

Colorado Kellie:

Thanks for your feedback.

For anyone that is comfortable with filtering reports in QB, they would not need to create the separate subclasses. From what I have seen over the years, many are not familiar with all of that, so was trying to keep it simple by setting up the subclasses to post into as payments are made, eliminating the need to filter at all. Some may see it as overkill. 

I don't work with QB payroll that much - am checking into options for class tracking there and will post some ideas once I see the payroll system in more detail.

Scott

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I opened a new bank account and had to funds deposited to this account.

 

Will cut checks and run payroll specifically through this account.

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Level 1

What's the way to track SBA PPP loan money & expenses in Quickbooks online?

I opened a new checking account and had the ppp funds deposited here.

 

Will run everything through this new account.

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