Learn how to set up accounts to track money that your partners or owners invest in or draw from a business.
With QuickBooks Online, you can set up owners or partners to track what they contribute to your business.
Owners typically own stock in the company. Partners, on the other hand, contribute money and other assets without sharing in the profits and losses.
Note: For more info on partner and owners, visit the IRS website.
Step 1: Set up an owner or partner as a vendor
QuickBooks uses vendors as a way to track what you, partners, or co-owners contribute to your business. If you, an owner, or partner, wants to make a contribution, you need to set up a vendor for every person.
- Go to Get paid & pay and select Vendors (Take me there).
- Select New vendor.
- Fill out the form and select Save.
Step 2: Set up equity accounts
Once you’ve set up your owner or partner as a vendor, you'll need to set up their owner or partner equity account. These accounts let you see what someone invests in and draws from a business.
Add an account to track their investment
If you’re the sole owner, you need to set up just one equity account.
- Go to Settings ⚙, then select Chart of accounts.
- Select New.
- From the Account Type ▼ dropdown, select Equity.
- From the Detail Type ▼ dropdown, select Owner's Equity or Partner's Equity depending on your situation.
- Select Save and Close.
How to add multiple equity accounts
Before setting up accounts for more than one partner or owner, you need to create one equity account. Afterwards, you can create separate equity accounts for each partner or owner.
As you’re filling out the info on the equity account, just select Is sub-account, and then enter the parent account.
Track money going into your business
Now that you’ve set up an owner or partner, record any investments they add to the business.