Hi ! Can anybody tell me how do I record owner's contributions to the business. should I use an equity account??

That depends on the type of entity.  If the company is a partnership, LLC or single member LLC or sole prop then this is an owner contribution in the equity section.  If the company is an S or C-Corp, the answer would depend on whether the owner expects to be paid back.  If to be paid back, then this would show as a liability called Shareholder/Stockholder loan.  If not to be paid back, then it would be an account called Additional Paid in Capital (APIC) which is an equity account.

In QB Desktop Pro 2019, when creating a new account for the purpose of owner contributions,  I do not see a Detail Type field referenced in step5.

Could I have used an incorrect new account path?    Thanks.

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1. Go to Accounting.    
2. Select Chart of Accounts.
3. Click New.
4. Under Account Type, select Equity.
5. Select Owner's Equity from the Detail Type field.
6. Enter Owner's Contribution in the Name field.
7. Type in the contribution amount in the Balance field.
8. Click Save and close.

The resolution above is for QuickBooks Online, @J_R_F .

You don't need to add detail type in QuickBooks Desktop Pro, you can add this or enter on the Account Name or Description.

Let me show you how:

1. Go to Chart of Accounts.
2. Select Account then click New.
3. Choose Equity as the account type.
4. Click Continue.
   
   
5. Enter the Owner’s Equity as the Account Name or Description.
6. Select Save & Close.
   
   

In case you need some information about organizing your QuickBooks account, you can visit this link: Help articles. You can click on each topic to view them.

You’ve got me if you have an additional concern about QuickBooks.

Thank you, MadelynC 

How do I record owners contribution if there are 3 partners.

Hello, 

What if i keep making additional contributions? Do i record those with a journal entry? what other account do I use? Thanks in advance.

Could you tell me how to make a journal entry for a owner's contribution for a c corp that wants to be paid back. I'm not 100% how to show the deposit into the account and set up something to pay it back over time. thank you in advance. 

Hello I have a question:

 After creating the  "Owner's contribution"-under equity account. If the business owner made additional transactions paid by their personal money (Not business), How would I record that?

1) do I just do journal entry for the totals for each month?

2) upload from excel the total transaction to qbo online (kind of like petty cash)?

Thanks

I appreciate you for joining the thread, @accountingatheart. I can share with you some insights about tracking business expenses paid by personal account.

Once you had additional business transactions paid by personal money, you can use journal entries to record the entry. Here's how:

1. Sign on to your QuickBooks Online (QBO) account.
2. Go to the Gear icon, then click +New.
3. Select Journal Entry.
4. On the first line, select the expense account for the purchase.
5. Enter the purchase amount in the Debits column.
6. On the second line, select Partner's equity or Owner's equity.
7. Enter the same purchase amount in the Credits column.
8. Click on Save and close.

When you decide to reimburse the amount, you can use a check or an expense transaction. I'm adding this link as your reference: Pay for business expenses with personal funds.

In case you need help with recording capital investments to track money going into your business, open this article for more information: Record an owner's contribution or capital investment in your business.

Let me know if you have any other follow-up questions while tracking your business expenses by adding a comment below. I'm just a post away to help. Keep safe!

Thanks for replying back to me. From reading this I know I am doing the correct recording. Thanks for the clarification.

You're always welcome, @accountingatheart.

Please know that our doors are always open here in the Community. If you have any other QuickBooks concerns, just post again or leave a comment below. Additionally, you can visit our help articles for more tips while working with QuickBooks in the future. From there, you can select the topic you need from account management, banking, reports, and more.

Keep safe and cheers for more success!

I had one more question that I need clarification.

 Do I reconcile owner's contribution and Owner's draw? or do we just only close the year and that's the only thing required to do?

Thanks for getting back with the Community, accountingatheart.
 

When it comes to reconciling, no accounts are required to be reconciled in QuickBooks. Doing so can help keep your books in order, but it's not a requirement in any way. Reconciliation is optional and up to each business if they choose to do it.
 

If you'd like to properly identify if you should be reconciling owner's draw/contribution accounts, I'd recommend checking with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.
 

I've also included a detailed resource about reconciling which may come in handy moving forward: How to Reconcile
 

Please don't hesitate to send a reply if there's any questions. Have an awesome day!

I have followed your steps, which are very clear and easy to follow, to enter an owner's contribution of $20,000; however, when I look at my account balance, it is now showing -20,000. What do you think happened?

This same thing happened to me, I think.

I added an owner contribution by creating an equity account. It then debited Open Balance Equity. I now have a negative number in OBE.  Is this correct? If not, how do I fix that?

Thank you.

What is the correct equity account to record owner contributions? In my Quickbooks Simple Start account, I have set up business type as sole trader but there is no equity -> owner contribution account option in chart of accounts.

Thanks for joining this thread, SRK2024.

You can add new accounts at any time to track different types of transactions. You'll want to create one equity account. Moreover, once you have set up your owner or partner as a vendor, we need to set up their owner or partner equity account. These accounts let you see what someone invests in and draws from a business.

Here are the steps to do that:

1. Go to Expenses and select Vendors.
2. Select New vendor.
3. Fill out the form and select Save.

Once you’ve set up your owner or partner as a vendor, you'll need to set up their owner or partner equity account. Here's how:

1. Go to Settings, then select Chart of accounts.
2. Select New.
3. From the Account Type dropdown, select Equity.
4. From the Detail Type dropdown, select Owner's Equity or Partner's Equity depending on your situation.
5. Select Save and Close.

For future reference, if you have existing accounts from another company file, you can import them to QuickBooks Online.

If you have more queries on Chart of accounts or any other QuickBooks-related matters, this thread is always open. We're available to assist 24/7. Stay safe.