cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Get your business taxes done right with unlimited expert help. Check out QuickBooks Live Expert Tax
Ugur01
Level 4

Categorization of Money Given to a Friend

Hello,

 

A friend of mine needed money. I gave the amount (3000 USD) he needed from the company account to my friend. This is not a donation, nor did I give it as a loan and I will not take it back.

 

How can I categorize this amount?

 

Solved
Best answer February 16, 2023

Best Answers
Rainflurry
Level 14

Categorization of Money Given to a Friend

@Ugur01 

 

Whether you're a sole proprietor (SP), partnership, or S-corp, it is a reduction in equity.  If you're a SP, record it as Owner's Capital or Owner's Draw.  If you're a partnership, record it as a Partner Distribution.  If you're an S-corp, record it as a Shareholder Distribution.  If you're a partnership or S-corp, distributions need to be made in accordance with your partnership agreement or shareholder ownership percentage.

View solution in original post

2 Comments 2
Rainflurry
Level 14

Categorization of Money Given to a Friend

@Ugur01 

 

Whether you're a sole proprietor (SP), partnership, or S-corp, it is a reduction in equity.  If you're a SP, record it as Owner's Capital or Owner's Draw.  If you're a partnership, record it as a Partner Distribution.  If you're an S-corp, record it as a Shareholder Distribution.  If you're a partnership or S-corp, distributions need to be made in accordance with your partnership agreement or shareholder ownership percentage.

FritzF
Moderator

Categorization of Money Given to a Friend

Hi again, Rainflurry.

 

I appreciate you for always sharing your knowledge about QuickBooks. This will definitely help other users as well in the future. Please keep on posting here in the Community.

 

Keep safe and have a great rest of the day.

Get answers fast!
Log in and ask our experts your toughest QuickBooks questions today.

Need to get in touch?

Contact us
Sign in for the best experience
Ask questions, get answers, and join our large community of QuickBooks users.
Sign In / Sign Up