Categorizing Bank deposits to cover expenses?

Thank you for visiting the QuickBooks Community, Mauidan. Please know that we are no longer supported QuickBooks 2003. However, I can still provide details to ensure you can manage your transactions in the program.

To start with, when you categorize a deposit in QuickBooks, you can still consider this as  Personal. 

On the other hand, I recommend creating a journal entry within your program and you can use Partner's equity or Owner's equity as the category. This is done to record the business expenses you paid for with personal funds. 

However, I still recommend consulting a Tax professional. They will be able to advise you on how to correctly handle the transactions, particularly the account to be used for your deposit that came by a hardship. This is done to ensure your records are in shipshape when organizing tax data.

Moreover, you can subscribe to a QuickBooks Self-Employed account if you wish to manage your transactions within this program. Then, in case you need details on how QBSE helps you record your self-employed income and expenses, track mileage, and prepare your Schedule C tax form, you can read this article: Overview of QuickBooks Self-Employed. 

Don't hesitate to click the Reply button below if you have any other questions related to QuickBooks. I'll be right here to help you out, Mauidan. Keep Safe and have a great day!

Thank you very much for that information. I've consulted a tax professional, that part is handled.

Regarding setting up accounts I made some headway.

I was wondering if you would take a look to check what I did so far? 

If not, no worries..

I created a few (equity) accounts: one is "Bank" and "Shareholder Capital"
and then a sub account "Shareholder Contributions".

When recording the deposit, in the "Received From" field……
Does my name go there since it coming out of my personal bank account or
should that be the bank name (American Savings)?

I'd be glad to review your progress, @Mauidan.

When you record the deposit, ensure you enter the bank's name in the "Received From" field instead of your name. This is because the deposit is made from your bank account rather than directly from you.

Just in case you want to review and delete your bank deposits, you can refer to the "Next steps: Manage your bank deposits" section of this article for guidance: Record and make bank deposits in QuickBooks Desktop.

Please hit us up if you need further assistance with recording your deposit. We've got your back.

I notice the deposit displays on the balance sheet under assets, but not on the P&L.

Shouldn't it show in total income on the P&L?

Thanks for the update, Mauidan. I'll explain further how deposits show on your financial reports in QuickBooks Desktop (QBDT) so you can handle them accordingly.

Bank accounts are classified as Balance Sheet accounts. The Profit and Loss report summarizes the total income and expenses of your business, so Balance Sheet accounts don't affect it. 

When you make a deposit, the account in the From Account field will determine which one it'll get recorded. Since you've created one under an asset account, it'll only show on your Balance Sheet.

Furthermore, since QuickBooks saves your deposit according to your input, be sure to select the appropriate account in the From Account field. With this, I'd recommend opening the transaction and making the necessary updates.

Additionally, we'd encourage you to reconcile your accounts regularly (monthly) to keep your financial data accurate. I've also included this article to guide you anytime you need help doing or fixing a reconciliation in QBDT: The reconcile workflow in QuickBooks.

If there's anything else you need in managing deposits or other reporting concerns, let me know in the comments below. I'm always ready to help you out.

Thank you very much for such a detailed answer. It was very helpful.

I'm a little slow with this info. Knowing my situation, that I had to cover expenses from

my bank account. Are you suggesting I update my entry in the "from account" field?

If so, can you show me what that would look like? 

"I'd recommend opening the transaction and making the necessary updates."