Created with Sketch.Learn about PPP and Loan Forgiveness, stay informed with the latest changes.
Created with Sketch.Questions about how to close your books for 2020? Visit our Year End Resources page.
Created with Sketch.New to QuickBooks or using a new product? Visit our Get Started resource page to help you get going.
Created with Sketch.Need to make changes to your account? Visit the Account Manager Portal.
cancel
Showing results for 
Search instead for 
Did you mean: 
Level 1

Do I have to add the owners personal bank account in order to process an ACH payment for owner's draw?

 
1 Comment
QuickBooks Team

Do I have to add the owners personal bank account in order to process an ACH payment for owner's draw?

Hello there, @userinfo18.

 

To handle the owner's contribution, you need to set up an owner's draw account as an equity account. An equity account is used to track withdrawals of the company's assets to pay an owner. If you're a sole proprietor, you must be paid with an owner's draw instead of an employee paycheck.

 

To create an Equity account, here's how:

 

  1. Click the Gear icon, then select Chart of Accounts.
  2. Click New.
  3. From the Account Type drop-down, select Equity.
  4. From the Detail Type drop-down, choose Owner's Equity.
  5. Enter an opening balance.
  6. Click Save and Close.

After creating the account, you can write a check from an owner's equity account to pay them.

 

You can read through these articles for detailed information:

 

 

Most importantly, I still recommend checking with your accountant for more guidance. He/she may add suggestions based on what's more suitable for your business and to your books.

 

If you have other questions, you can always visit us back here.

Need to get in touch?

Contact us