Property taxes paid with liability account, how to record
I have a friend who lives with me and is liable for 1/2 of the taxes on property. I also owe my friend a certain amount of money. When tax bill comes in, I pay it in full using my personal bank account and want to decrease loan amount that I owe to my friend on 1/2 of the bill.
I record my loan on "other current liability" account type.
When I record my transaction as a general journal entry I debit loan account(liability) and credit Taxes(expense) account. But this gives me negative value (bill amount) on a Profit&loss report under Taxes. So I assume I should have credited a different account.
But what account I should credit then? An income account?