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JordancQ
Level 1

Owner carry/ Note

My business carries the note on several houses but we don't owe anything on those houses they are already paid off. How do I log those into quickbooks? I was told to put in long term liability for notes payable but that doesn't make sense to me considering our business doesn't owe any money.

Solved
Best answer May 18, 2022

Best Answers
Rainflurry
Level 10

Owner carry/ Note

@JordancQ 

 

If you carry a note on a house that you sold, you record the note as a note receivable asset account.  When you receive payments from the borrower, record a deposit and assign the principal portion of the payment to the note receivable asset account and the interest portion to an interest income account.   

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8 Comments 8
Rose-A
Moderator

Owner carry/ Note

Hey there, JordancQ. Logging owner's carry/note in QuickBooks Desktop is quick and easy. Let me show you how.

 

Notes Payables are classified as liabilities. Long-term if it's beyond a longer period and short-term liabilities if the payable date is within a year.
 

For recording purposes, you can write a check to log these into QuickBooks Desktop. Here's how:

 

  1. Click Banking at the top menu bar and select Write Checks.
  2. Select the Bank Account you want to use to pay the loan.
  3. Verify the Check NO. and Date.
  4. In the Pay to the Order of field, select the name of the bank.
  5. In the Expenses tab:
    1. On the first line, select the liability account you created in Step 1. Then enter the payment for the principal amount.
  6. Hit Save & Close.

 

However, I'd still suggest working with an accountant. They can provide more expert advice from an accounting perspective.

 

To know more about how the note payables work in QuickBooks, check out this article: Manually track loans in QuickBooks Desktop. This will provide you with the step-by-step process of handling and recording liabilities in QuickBooks.

 

It'll be always my pleasure to help if you have any other questions. Just keep me posted in the comment section down below.

JordancQ
Level 1

Owner carry/ Note

Would the payments to us from the customers go under notes receivable since they are paying us for their house payment? 

JordancQ
Level 1

Owner carry/ Note

Would the payments that the customers pay towards their house payment go under notes receivable since they are paying us? 

LeizylM
QuickBooks Team

Owner carry/ Note

Hi there, JordancQ.

 

I'd be glad to help and provide some information about accounts receivable in QuickBooks.

 

Accounts Receivable refers to the amount that your customers owe to you for the goods or services sold to them on credit. Such credit sales are also known as trade receivables or extending trade credit to your customers.

 

In other words, you provide goods and services to your customers instantly. However, you receive payments for such goods and services after a few days.

 

I've added this article to learn more in how to set up accounts for your loans, and manually track them in QuickBooks Desktop: Track and mange your loans in QuickBooks Desktop.

 

We do like hearing from you, so drop us a line and let me know if you have other questions. Keep safe!

Rainflurry
Level 10

Owner carry/ Note

@JordancQ 

 

If you carry a note on a house that you sold, you record the note as a note receivable asset account.  When you receive payments from the borrower, record a deposit and assign the principal portion of the payment to the note receivable asset account and the interest portion to an interest income account.   

JordancQ
Level 1

Owner carry/ Note

Awesome that's what I was thinking thank you so much

JordancQ
Level 1

Owner carry/ Note

Awesome that's what I was thinking. Thank you so much 

FritzF
Moderator

Owner carry/ Note

Hi there, Rainflurry.

 

I appreciate you for always sharing your knowledge about QuickBooks. This will definitely help other users as well in the future.

 

Keep safe and have a great rest of the day.

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