Skip to main content
A
Anjunadeeper
July 21, 2022
Question

Payroll Deductions - for paying another business within the same company

  • July 21, 2022
  • 1 reply
  • 0 views

We have different companies, all identified through class, in our QB company file.  The companies (classes) are:  Rental Property and Accounting. 

 

An Accounting employee is actually also a tenant, or customer, in Rental Property.  We have agreed to deduct the biweekly rent out of the paycheck.  The deduction then will need to be received as a payment in the Rental Property company (class).

 

My questions are:

  • What should be the account the rental deduction should go to in the Accounting class?  (an asset, liability, expense)?
  • To move funds from the Accounting class to the Property Management class - as a receive payment to the monthly rental invoice - how do I do this?

 

Thank you for the help!

1 reply

BigRedConsulting
BigRedConsulting
July 23, 2022

RE: What should be the account the rental deduction should go to in the Accounting class? (an asset, liability, expense)?

 

You're holding the money for the employee until it is applied to their Rent, so it's normally a liability. However, you can't record an AR Payment using a liability account, but you can record it using an Asset account. So, perhaps set it up as an Asset.  Then set the payment preference so you can choose where to record your payments received (Edit | Preferences | Payments | Company Preferences, and then uncheck the lamely-labeled option "Use Undeposited funds as a default deposit to account", which really means "Don't let me choose which account to records Payments to, and force all payments to use Undeposited Funds" -  and has nothing whatsoever to do with Deposit transactions.)

 

RE: To move funds from the Accounting class to the Property Management class - as a receive payment to the monthly rental invoice - how do I do this?

 

Payments don't typically use classes. The invoice where you record the income uses a class, probably Property Management in your case. Once you enable a choice as noted above, then you can pick an account other than Undeposited Funds when receiving payments.  Pick the asset account you use on the rent deduction payroll item.

 

Once you record both the deduction from the paycheck and the payment applied to the AR invoice, then the asset account will balance out to 0.00.

Terms & ConditionsAccessibility statement