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shifty23
Level 1

We are a LLC and we have some personal expenses on the business card. What category do I put those under? Owners Pay and Personal expenses? or Other Expenses? or Owners Equity?

Our company is a LLC. The business card has been used for some personal expenses and I would like to put them in a category so that I can reconcile the books. I want to be sure I put them in the correct account and after reading on here I have seen a couple of different answers. Is it Owners pay and personal expenses or Owners Equity or Other expenses? 

3 Comments 3
john-pero
Community Champion

We are a LLC and we have some personal expenses on the business card. What category do I put those under? Owners Pay and Personal expenses? or Other Expenses? or Owners Equity?

Member Draw, an equity account. As an LLC youdo not gave owners, you have members. And you cannot pay yourself unless you elect to be taxed as a corporation (yes you can take all the money out you want but it is all draw)

Malcolm Ziman
Level 10

We are a LLC and we have some personal expenses on the business card. What category do I put those under? Owners Pay and Personal expenses? or Other Expenses? or Owners Equity?


@john-pero wrote:

As an LLC youdo not [h]ave owners, you have members. 


I don't see why you can't say you own an LLC. I understand you can't say you own a Sole Proprietorship, but you can say say you own a business

john-pero
Community Champion

We are a LLC and we have some personal expenses on the business card. What category do I put those under? Owners Pay and Personal expenses? or Other Expenses? or Owners Equity?


@Malcolm Ziman wrote:

@john-pero wrote:

As an LLC youdo not [h]ave owners, you have members. 


I don't see why you can't say you own an LLC. I understand you can't say you own a Sole Proprietorship, but you can say say you own a business


You can say you own a Sole Prop. You name it, operate as a dba and Malcolm owns Malcolm's Muffins.  You can say you own an LLC, even an LLC can own all or part of other LLC's but in the operating agreement you are listed as a member, not a partner, not owner - you sign tax returns as "member" or should be. Yes it is semantics when you get right down to it.

 

My point was to try to separate the concept of LLC with members from a sole prop or loose partnership with owners, partners respectively and from S or C corp with shareholders who rightfully are all owners as well, but not all employees

 

 

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