Let me help you record the loan and repayment given to your employee in QuickBooks Online (QBO).
In QuickBooks Online, we can set up a liability account to record the loan and its payments. This account tracks what you owe. First, we need to create and set up a liability account so you can record the loan. Here’s how:
- Go to the Gear icon on the top menu.
- Select Chart of Accounts.
- Click New to create a new account.
- From the Account Type dropdown, select Long-Term Liabilities. If you plan to pay off the loan by the end of the current fiscal year, choose Other Current Liabilities instead.
- From the Detail Type dropdown, select Notes Payable.
- Give the account a relevant name.
- Choose when you want to start tracking your finances. In the Balance field, enter the amount in the account, and determine the as-of-date. Enter today's date if you want to start tracking immediately.
- Press Save and Close.
Then, follow Steps 2 and 3 to finish the process in this article: Set up a loan in QuickBooks Online. Since you don't want to deduct the loan repayment from your employee's paycheck, you can create a deposit for it.
I'll add some articles for additional details about handling accounts in the Chart of Accounts:
- Learn how to delete bank, income, and other types of accounts from your chart of accounts.
- Move your chart of accounts to QuickBooks Online.
Keep me posted if you have other questions about recording loan payments. I'll be happy to help you again. Stay safe!
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