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swadesteps
April 15, 2024
Question

How to categorize payments made to an American Express card that is used for both business and personal purposes?

  • April 15, 2024
  • 1 reply
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I have an American Express card that I use for both business and personal expenses, and which is connected directly to QuickBooks Online.  I have been Excluding the personal expenses so they don't hit my P&L as an expense.  2 payments automatically added to QB (1 personal + 1 business) each month.  I have been Excluding the personal payment and Categorizing the business payment.  Although, it looks like QB isn't recognizing that the credit card balance isn't being paid down by both payment transactions.  

 

Is there a better way to categorize the personal payment so that the personal transactions are not categorized as expense transactions, and the personal payment doesn't debit the credit card balance properly?  

1 reply

S
swadestepsAuthor
April 15, 2024

Can't edit initial post.  So, to add to my question...when trying to categorize a personal payment as a Credit Card payment its requiring me to choose a bank account from which the payment came.  Although, since I'm paying from a personal account that connected to QBO, I don't have an option that fits the situation.  

BigRedConsulting
BigRedConsulting
April 15, 2024

Paying from a personal account is an increase in equity.  So, use an equity account such as "owners equity" as the source for the payment, which you can enter in the credit card's register.

S
swadestepsAuthor
April 16, 2024

I don't believe that is the answer and I'll tell you why.  I'm not paying personal expenses with company funds.  If an expense is personal, I pay it from an outside personal account not tied to the company or QBO.  If its a business expense, I do pay it from a business account that is tied to the company and QBO.  

 

So, I don't think the personal payments, since they are really outside of the company (just happen to be included in the data feed from Amex to QBO, should be considered equity.  Am I missing something, or did I not clearly explain my initial question? 

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