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Join nowUsing Desktop Premier 2019, I started a new LLC & QB automatically setup Members Draw & Members Equity accounts.
I also opened a checking account and it has opening balance equity.
Now I need to make additional cash investments into the business. Cash will be coming from 2 different members, so I need Member Equity accounts for each...
At first I tried depositing to the checking account and using "Members Equity" as the account type. Quickbooks, however, warned that this is an automatic account and suggested I create another. Realizing I should have separate accounts for each member anyway, I tried creating an equity account "Member Equity - John Doe" as a sub account under the already-existing "Members Equity" account.
Quickbooks didn't like this, saying "This account cannot have subaccounts. It is a special account automatically generated by Quickbooks."
So what should I do? I was initially thinking I should have this structure:
Members Equity
- Member Equity-John Doe
- Member Equity-Jane Doe
Members Draw
- Member Draw-John Doe
- Member Draw-Jane Doe
But not sure what to do now with these 'automatically generated' special accounts.
Hi @ken_brooks,
You can create a sub-account for your members equity and members draw accounts the same with your set up. However, I'd still suggest consulting with your accountant to properly record your investment.
In your case, you can run a verify and rebuild data in QuickBooks Desktop to get past the prompt. After running these tools, restart your computer and try creating a sub-accounts again.
I'm also adding this handy article for more information about the QuickBooks Chart of Accounts.
Thanks you for coming into to Community today. Please know that I'm always here if you have other questions. More power and success to your business.
I have the exact same problem.
I tried and run a verify and rebuild date thing but it didn't work. I was wondering if you solved it and what you did to solve it? Thanks for your time and post!
Thanks for joining the thread, @BAC_J.
The previous agent is trying to set as a parent may be one of the default accounts created for automatically generating balances.
In this case, we can create a new parent account before making a sub-account. We need to make sure that the parent and sub-account have the same category.
To add a sub-account, please check out this article: Create, edit, or delete an account in QuickBooks Desktop.
Of course, I would still suggest consulting your accountant to know the correct accounts to be used.
Also, I can see that this article can be helpful for you to understand the chart of accounts in QuickBooks.
I'm just a few clicks away if you have any other concerns. Take care.
Thank you so much! This was very helpful!I thought I had to use the default accounts and was getting issue above.
I made new parent accounts and created subaccounts underneath them and worked great!
Thank you again for your quick reply!
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