Categorizing distributions

sw1222 · ‎June 10, 2024

My boss asked me to do this:

Please wire funds from Acct A (came in as profit) to Acct B (same company as account A) then wire those funds in Account B to Account C (different company) as a distribution.

So, i will categorize as follows:

income-->account A-->loan btwn account to account B-->distribution to account C-->??

How would I categorize the incoming funds from the distribution to account C?

Rainflurry · ‎June 10, 2024

@sw1222

Your question was answered here:

https://quickbooks.intuit.com/learn-support/en-us/reports-and-accounting/reporting-distributions/00/...

To recap, just record the wire between A and B as a transfer (New > Transfer) for the same company. There's no loan and this has nothing to do with income - it is just a transfer between two bank accounts. As far as how to record the payment made from B to C, you will need to know what business entities both companies are. Are these S-corps (100% owned), sole proprietorships, or a combination thereof? If they are 100% owned S-Corps, the payment from B is a Shareholder Distribution and, in C, it is recorded as a Shareholder Contribution.

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