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Elizabeth1948
June 4, 2024
Question

Tracking commissions

  • June 4, 2024
  • 1 reply
  • 0 views

I have been using Quickbooks for 20 years on a cash basis, which has worked fine until now.  I recently began acting and signed with a talent agent.  The talent agent receives my fee paid by the client's payroll company.  I am considered a W2 employee by the client, and they have taken out my federal and state taxes from the gross amount earned.  The agent receives the check, takes his commission, and sends me a check for the balance, listing all taxes based on the gross  and commissions as deductions. 

I enter the net amount of my earnings to my checking account as income but will report the full amount for income tax purposes to my accountant based on the W2 that I receive at the end of the year.  But, I have no way of showing the expense of commission through my system, because I didn't actually send them a check for the commission.  I need to figure out how to set up an account that logs these commissions and shows them as an expense on my P&L. 

 

1 reply

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IrishNinoJ
June 5, 2024

Hello there, Elizabeth1948. I'm here to guide you on how to track commissions.

 

To begin, set up an expense account for the commission. Here's how:

 

  1. On the left navigational bar, go to the Transaction tab.
  2. Select Chart of accounts and then click the New button.
  3. In the Account Type section, choose Expense and complete the necessary fields. I recommend consulting an accountant for this process.
  4. Once you're ready, click the Save and Close button.

 

If you use a bank deposit when entering the income, you can add the commission as an expense line item to it. Here's how:

 

  1. Go to the +New icon and click Bank deposit.
  2. Choose an Account
  3. In the Add funds to this deposit section, enter the Income account in the first line item and add the amount as positive.
  4. Add to the second line the expense account you've created and add the amount as negative.
  5. Click Save and close.

 

To track the commission, you can run an expense report.
 

In addition, you can customize your reports and focus on the details that matter the most to you: Customize reports in QuickBooks Online.

 

Let me know if you have any further questions besides the expense account. The Community is here to assist you 24/7.

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Elizabeth1948Author
June 5, 2024

Thank you for your comprehensive reponse.  I will give this a try and and see how it works.  As soon as I get my first check, I'll know.  If I still have issues, I will reconnect. 

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