Enter a name for the account, like “PPP Loan Forgiveness”.In the Detail Type, choose Other Miscellaneous Income.In the Account Type, choose Other Income.6) Create a new account to record the use of the PPP loan funds.
The PPP Loan Funds sub-account will show how much of the funds remain.Īfter your lender determines how much of the loan is forgiven, you can transfer the forgiven amount. These amounts can be obtained from a Payroll Summary by Employee report. The transfer amount used for payroll will be for the allowable expenses only (gross wages, employer retirement plan contribution, employer health insurance premiums paid). Note in the memo what the transfer is for. Enter the amount received in the amount columnĤ) Pay your expenses from the bank account as you normally would.Īfter paying an eligible expense using PPP loan funds, enter a journal entry to transfer the amount from the PPP Loan Funds sub-account to the regular bank account.In the account column, choose the loan account created.Change the Account to the new bank sub-account.Enter a name for the account, like “PPP Loan”.In the Detail Type, choose Notes Payable.In the Account Type, then choose Long Term Liabilities.Click Is Sub-account and choose the bank account from the drop downĢ) Create a new loan account in the Chart of Accounts.
There are a few options in QuickBooks Online for how to record the funds received from the Paycheck Protection Program (PPP) loan and the expenses to which the funds are used. Leave a comment below if you have questions about using QuickBooks Online to run your nonprofit.Recording a PPP Loan and Tracking Corresponding Expenses Repeat the description from above in the memo field then attach a copy of the bill and check in the attachment section. In the check number field, enter the check number or select the option to print later. Select an existing vendor from the list or create a new one.Ĭhoose a checking or savings account from the account list.Įverything you enter in this screen must match the check you paid to the vendor.Įnter a payment date and payment method. QuickBooks Online will open the check entry screen. Repeat the description from above in the memo field then attach a copy of the payment receipt in the attachment section.Ĭlick on the Quick Create (+) icon then select Check. Then use that service in the item details part of the expense entry screen. If you have billable expenses that will be invoiced to a customer or a donor or a grant, you need to create a product or service that is linked to your general ledger expense account. Select the applicable class for the transaction. Select an expense account for the transaction.Įnter the purpose of the payment in the description field.Įnter the payment amount and leave the billable box unchecked.ĭon’t select any customer if not billable. Select “without donor restrictions” as the location. In the reference number field, enter the payment confirmation number. Select an existing vendor from the list or create a new one.Ĭhoose a checking or savings account or credit card account from the account list.Įverything you enter on this screen must match the bill and payment receipt that you have.Įnter a payment date and payment method.
Therefore, you should always use the bill entry and bill payment options with a credit card or a check to record your expense transactions in QuickBooks Online.Ĭlick on the Quick Create (+) icon then select Expense. Use the check feature to record a physical check or an ACH transaction.Īs a nonprofit, you are audited using the accrual accounting method to comply with GAAP. Only use the expense feature to record a debit or credit card transaction in QuickBooks Online. Tips to Tracking Expenses in QuickBooks Online