How to keep Client Re-Imbursed Expenses from Showing as Profit

skspencer1516 · ‎February 25, 2025

I have a Sole Proprietorship LLC. I will buy equipment for a client with no markup. I add the equipment purchase to the invoice so as to be re-imbursed by the client. How do I keep the equipment that I am being re-imbursed for from showing as profit since I am not making any money on that part of the invoice. Thanks

MoiraskyeT · ‎February 25, 2025

Hi, skspencer1516. To make sure that the equipment you buy and subsequently invoice for your client's reimbursement doesn’t incorrectly inflate your profits, you should set it up as a billable expense without adding any mark up.

Create a specific category to track the equipment and mark it as billable. Please ensure to reach out to your account since you're not sure what expense account you're referring

I included this article for you to check to learn more about how to organize your products and services in QuickBooks Online: Group products and services into different categories in QuickBooks Online.

If you want to import products and services into QuickBooks Online, check out this article. It guides you on how to upload a list from Excel, CSV, or Google Sheets into QuickBooks Online: Import products and services into QuickBooks Online.

For customized support with QuickBooks activities like report management or transaction tracking, discover our QuickBooks Live Expert Assisted option. Our skilled experts are available to help you through every aspect of your QuickBooks experience, guaranteeing you get the best possible results.

Your attention to detail and commitment to accurate records is impressive. If you have more questions about reimbursement expenses or anything else, feel free to reply below. Best wishes!

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FishingForAnswers · ‎February 25, 2025

@skspencer1516 If your client reimbursed you for the exact amount you paid for the equipment, and you recorded the purchase of said equipment as either Inventory>COGS or such like in your QB, then it is already not showing as profit. It should be handled as all of your other materials sold Items would be.

Instead, it is showing as income with an equal offset, reducing the impact on your P&L to $0.00.

You may be intending not to show it as income, but that is not advisable; if nothing else, insurance companies tend to factor in income to certain insurance policy costs.

As at least one of my clients found out to their great disappointment, the insurance companies absolutely consider the situation you describe to be income.

MoiraskyeT · ‎February 25, 2025

Hi, skspencer1516. To make sure that the equipment you buy and subsequently invoice for your client's reimbursement doesn’t incorrectly inflate your profits, you should set it up as a billable expense without adding any mark up.

Create a specific category to track the equipment and mark it as billable. Please ensure to reach out to your account since you're not sure what expense account you're referring

I included this article for you to check to learn more about how to organize your products and services in QuickBooks Online: Group products and services into different categories in QuickBooks Online.

If you want to import products and services into QuickBooks Online, check out this article. It guides you on how to upload a list from Excel, CSV, or Google Sheets into QuickBooks Online: Import products and services into QuickBooks Online.

For customized support with QuickBooks activities like report management or transaction tracking, discover our QuickBooks Live Expert Assisted option. Our skilled experts are available to help you through every aspect of your QuickBooks experience, guaranteeing you get the best possible results.

Your attention to detail and commitment to accurate records is impressive. If you have more questions about reimbursement expenses or anything else, feel free to reply below. Best wishes!

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How to keep Client Re-Imbursed Expenses from Showing as Profit