how do I categorize my cash investments into my retail store?

over the last year I made several cash transfers from savings into my Retail business bank account. How should I categorize the transactions? Its a sole proprietorship. I use the Turbotax Home and Business software. a few were from savings, one was a Stimulus Payment.

Best Answer

  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Accepted Answer
    Hi @amigoman,

    From a Quicken perspective - you should record money that you "invest" in your sole proprietorship business as either:
     1) "Loans from Owner" - if you expect to pay them back, or
    2) as "Owner Capital" - if they simply represent investments in the business.

    The source of the funds that you used in this case really doesn't matter, since both "personal savings" and the personal "stimulus" payment are your personal funds.  Had you received a PPP loan - that would be a different story.

    You reference "Turbo Tax Home and Business" - so I suppose you are wondering how those funds loaned to the business are to be handled for tax purposes. And, while I am not providing you with tax advice, I would be of the personal view that making those loans to a sole proprietorship would not affect your taxes since loans are not deductible expenses.

    Hope this helps.  Let mw know if you have any followups.

    Frankx


                           Quicken H&B-Subscription Ver. 34.24 - Windows 10-Home Ver. 2004
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -

Answers

  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Accepted Answer
    Hi @amigoman,

    From a Quicken perspective - you should record money that you "invest" in your sole proprietorship business as either:
     1) "Loans from Owner" - if you expect to pay them back, or
    2) as "Owner Capital" - if they simply represent investments in the business.

    The source of the funds that you used in this case really doesn't matter, since both "personal savings" and the personal "stimulus" payment are your personal funds.  Had you received a PPP loan - that would be a different story.

    You reference "Turbo Tax Home and Business" - so I suppose you are wondering how those funds loaned to the business are to be handled for tax purposes. And, while I am not providing you with tax advice, I would be of the personal view that making those loans to a sole proprietorship would not affect your taxes since loans are not deductible expenses.

    Hope this helps.  Let mw know if you have any followups.

    Frankx


                           Quicken H&B-Subscription Ver. 34.24 - Windows 10-Home Ver. 2004
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -
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