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Level 1

Track owner investment (loan) and expenses

Im using QB Online and myself and 2 others started a new company, I am pretty much the sole capital investment, cash partner at this time.   I have make several payments for business expenses, which only 1 of which was a deposit into our bank account.   All others were payments made for business expenses with my personal funds.   All partners have the agreement the funds I put into the business are essentially a loan to the business to which the business will pay me back.   These loan repayment funds are completely different than our owners draw from company profits.

 

How can I categorize these "loans" into quickbooks?   For example, I made a $5000 deposit into the bank, we wrote checks out of the bank account to pay expenses .   I also made several payments to "employees" from personal funds to cover business expenses.   I want to track these expenses, and also show the money I sent them personally as  liability owed back to me.   I hope I was clear and really look forward to your insight as I have no idea how to input all this correctly.   


Thanks!!

1 Comment
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Level 15

Track owner investment (loan) and expenses

This worries me a little: "I also made several payments to "employees" from personal funds to cover business expenses."

 

You really don't have this in reality, so it seems like you are "playing" at being a business entity. You need actual guidance from your CPA, because that sentence violates a Bunch of regulations.

 

Either you have Employees, or you don't. Either this is Payroll, or they are not employee and this is Independent Contractors. That means you have to learn how to do that right. The penalty for not properly managing the IC process for purposes of 1099-Misc is $100 per day per name.

 

Your CPA can help guide you; you seem to be asking about partner loan as Liability, but you didn't tell us if this is a Corporation of some type, an LLC? The tax entity type matters. For this staetment:

"These loan repayment funds are completely different than our owners draw from company profits."

 

You might not have the correct perspective per the way the IRS will treat it, for instance. That's why asking accounting and tax rule guidance from the QB user forum is not the best idea.

 

Once your CPA helps you know what these are called, we can help you handle how to enter them. But we don't know your accounting requirements.

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