Hi @BarsinA, thank you for your reply. I'm sorry, I didn't see it until now. Your reply appears to assume that I will be tracking business expenses made with a personal payment account in the Personal profile. Since the Personal and Business profiles are no longer communicating, I will not spend time tracking personal expenses in Wave. How do I record business expenses paid with personal payment account on the Business side? Example: If I use Personal VISA to pay my business phone bill? What should it look like?
This would be handled by selecting the account type to be an equity account. In Wave this would be considered Money brought into your business by an account separate from the business account.
You can create an equity account called "personal Visa" or something of the sort and categorize your transaction's "account" drop down to this equity account. This will not show as an expense your business has made but rather an outside equity source. You'll then be able to categorize it accordingly!
If you're paying that amount back from your business to your personal, you can simply create an expense transaction from your business checking account and categorize it as a personal > Personal visa. Hope this helps!
HI. I have to agree. I think a video of this issue is much needed. I am reading through all of this and it's very confusing. The bottom line for me is understanding the reports. If choose "Share Equity...." will it ignore the transaction in all my reports. (Which is what I want.) I don't want to delete these transactions...since they may have nothing to do with my business. (For example. I may have accidentally bought groceries on my business account. I later transferred money into my business to make up for it.) You get the idea. PLEASE. make a video instead of having to scroll through these forums. The term "share equity" is confusing for us non-professional accountants. Thank you!
Hey @LIsa_Mia_Studios and welcome to Wave's Community Forum. Because the features in Wave are constantly evolving, having videos that are accurate is extremely difficult to create and maintain. In saying that, we are happy to help through the Community Forum as you have found!
In regards to the "Share Equity" option that you are referencing, can you actually upload a screenshot of where you are seeing this option? I ask because if you are seeing transactions that we for personal use but on a business card, then you shouldn't actually need to choose any of the equity options, as the "Personal" workflow (i.e. categorizing the transaction using the option for "Personal", should streamline the process). In saying that, the screenshot will help us to understand the flow that you are using and provide some guidance. Thanks in advance!
It almost seems easier to just delete non-business transactions from my personal account that I have flow in. I really didn't want to do that.
From my Business wave account, I imported from my bank: my business checking, savings, and also my personal checking account. I have sometimes purchased business items from my personal account every once and a while. So I was trying to exclude all those non-business things from my personal account and not have it count for any of the numbers or reports. Does that make sense?
So figuring out how to declare them that way was what I think we are all looking for in this forum. Help!
What would be the best way to account for a business expense paid for with a personal credit card? Hypothetical example, I owe property insurance on a rental that is $1165.00 and I pay it with a personal credit card. How would this look in Wave? The Personal credit card is not linked to my business account in wave, I simply would like to know how to account for it?? Is it frowned on as well? Commingling - breaking the corporate veil??? I have tried to obtain a business credit card but because it is a real estate type business, everybody is telling me I must wait 2 years. For my other Pool Business, I was approved in seconds for a healthy business credit card after being in business for 5 days for crying out loud. Please help! Thank you.
Hey @TODavid69! Great question. Typically, this wouldn't really be the best course of action, no. It's always going to be better-advised to have your business card handle these types of transactions, but it's not totally impossible to deal with. I'd say you might want to just split these types of transactions out within your account, to make sure you know that those had been paid with your personal card. Tracking those transactions properly and independently (say, with their own liability account in your Chart of Accounts) is going to be the best way to make sure that you can recoup your costs eventually and not be out of pocket from your personal card. I hope that makes sense!
I have the same question as others here, should I add a new equity account under Business Owner Contribution and Drawing or a new liability account under Due to You and Other Business Owners? The guidance above references an equity account, but in the program I am instructed that "all personal transactions must flow through a liability account."
Hi. am I understanding right that the ability to transfer transactions between business/personal profiles is no longer a thing. I am quite disappointed that this feature has been removed. It was a big time saver for having multiple business/ bank accounts with in a house hold. It would be handy even if at the least, the equity accounts for all the business showed up in the other business/personal profiles.... cause sometimes family's have lots of businesses and bank accounts
At this present moment it has been removed due to a previous accounting/language layer which was not correct. We are looking at future ways to bring this back into our system (sorry no ETA) however in the meantime this is the current workaround!
Hello - Looking at using Wave so I've been reading the comments. I want to find out if personal transactions can or cannot be recorded as per the note above? (Sophia C. Updated: Friday at 15:33)
Has that ability been removed (BarsinA) or does that comment refer to something else? Thanks
Hi @Floss , thanks for your message. The above comments are referring to our old software system's version of recording personal transactions, which is not available anymore. The new way to record transactions in Wave as personal is to categorize the transaction as Owner's Investment/Drawing!
It's still a little unclear as to whether the Personal expense accounts should correspond with the Business accounts to separate expenses. I am particularly interested in this as regards a Sole Proprietorship. I understand moving it through the Owner's Investment/Drawing as the double-entry. Are we essentially keeping two sets of books?
...and further, if we are keeping two sets should we double the cash accounts to have them connected in both the Personal and the Business sides so that we can import detail in both sides? Then have the offset in Personal also be to Owner's Investment/Drawing?
@BarsinA - Thank for your answer on May 8, 2020 to @Canaczech . It was the answer I needed after reading this long thread.
Follow up question:
After categorizing transactions to the new Equity account ' personal Visa', (as stated it's not an business expense), how do you then create a report to send to your CPA, that shows it as an expense to deduct/include in a business category (say business meal & entertainment, business telephone, etc...)?. That is, how you do you make sure it's included in your Business P/L Statement, List of Transactions, etc for Business reporting to your CPA?
Hi @cjDuggan , thanks for your message! To clarify, yes - this approach encourages keeping separate books, one for business and one for personal. This makes things a bit easier come tax time. If, for example, you want to record that you paid for a personal item with your business card, you would create the expense transaction and categorize it to Owner's Investment/Drawings. Then, on your personal bookkeeping, you would create an income transaction categorized as Owner's Investment/Drawings.
Hi @GlbInv , thanks for getting back! In this case, if a transaction is being marked as personal, it will not appear on your reports as a business expense in order to respect the previous 'personal' categorization.
Why not just use Owners Equity as the account you transfer personal money into and out of? Why do we need Owner's Investment/Drawings and/or Deposit from Personal and Personal Expense or Withdrawal? Also, where is "the transaction detail view"? Are these some kind of "sub-accounts" to Owners Equity? Thanks
You could in theory, however the present method adds a language layer for it being a personal transaction until Wave reinstates a method of physically moving the transaction. They aren't technically sub accounts as Wave does not have sub accounts at this time, it's once again more of the language layer on the transaction side.
As a sole proprietor with a CapitalOne credit card, a comment.
Between this change and Wave's months now of inexcusable failure of its new data processor (Plaid) to support data linking with many major financial institutions, you have destroyed not only the basis of my accounting system, but irretrievably altered years of my past data that was maintained on your own recommended use of a linked Personal account. These changes happened with no notice, zero empathy, and no recourse.
I have no words for the amount of pain and wasted time involved. I cannot imagine treating users this way. Your language about it continues to mask the harm you have done, with words like "Simplified" about this feature, and with wilfully dishonest inclusion of data import interfaces for services you know won't work.
If I borrowed $800 from my personal money to use to buy materials for my business, I am supposed to use the "Owner investment/drawings" right? Then when I take that money back out, to repay my personal checking account, what do I do? I can't find it anywhere!
When you're recording this on your business' side select a new income transaction > Make the account your business checking account (or wherever the funds have landed) > Categorize it as owners investment/drawing. Keep in mind however this is actually money that is put into your business. It's not considered a loan, but more of money your business didn't earn, but did gain from outside equity.
You might actually benefit from creating a loan account? However we as moderators are not accountants so I would either reach out to an accountant about that or you can post in our accounting threads.
Thanks for the input. I did categorize the money coming in as Owners investment. The confusion was in how to deal with taking it back out to repay our personal account. We ended up creating a liability account called loan from owner. I am going to check with my accountant to see if we are doing it right.
That creation of the account sounds like a good idea! I think you could use the same account owner investment/drawing. Essentially, whether it's an income or an expense will determine whether the account balances.
There are no words for how frustrating this thread is and for how upset I am at having to possibly start over with a new software because of this horrible change of removing personal accounts. Most people using this are not professional CPAs. We are small business owners who thought we had found a simplified way to do bookkeeping. Many, many small businesses frequently move money between accounts. I personally have 5 small business accounts as well as 3 personal which are all listed under one joint tax return as a sole proprietorship. This has been a nightmare trying to understand "owner equity, shares", etc. Please fix this.
Agree with @benwolfe about Plaid. Since it doesn't work with my community bank I'm pretty much screwed. If you contact Plaid they just tell you to ask your bank - as a rank and file customer - to make a major decision like working with a payment processor - on their behalf. Garbage.
I'm also still not clear, after reading this thread, how to record payments to self. I pay myself twice monthly through the bill pay function and am not sure how to categorize/handle that.
I don't have the owner's investment/drawing account described above. For a personal expense in the business account, my only option is: Shareholder Loan
If I click on create new account, the only option is:
Due to You and Other Business Owners
What do I do?
Isn't it better to just delete the transaction? Because it looks like if I categorize it as a personal expense, it is listed under "Liabilities" in the business, but it is a not a liability.
I have been searching this long thread of comments to help with my issue without success, so I am now a first time poster. I apologize if this info is buried in here but would love some help and a recap.
We are purchasing a home through an LLC, split between multiple members. The funds for the mortgage will be paid from a member's personal finances, adding to that member's equity within the LLC. How do I record this monthly (set of) transaction(s) in Wave?
Thanks!
This is a really great question that I would bring up to your accountant as well, however I'd likely recommend creating separate equity accounts in your Wave business:
Owner A contributions
Owner B contributions
Owner C contributions
Each payment made from your LLC business should be categorized as their respective business owners contribution. See example below:
Credit your mortgage liability account for say $500,000
Then say I make a $1000 contribution to this account and I'm owner A
Owner B makes a $2500 contribution to the mortgage account as well.
-Be sure to set the account to be your equity accounts you created for each contributor, and change the description as well. Select the Mortgage category.
You'll then notice that your Mortgage balance will decrease by the amount each person contributed
You'll also be able to filter your general ledger by each contributor to see their individual contributions.
@Barsin - Shouldn't the mortgage be a credit (withdrawal) for 500,000? Liabilities should have credit not debit balances. And all of the payments by owners should be "deposits" or debits to the mortgage, but credits (increases) to their capital contributions.
Comments
Hi @BarsinA, thank you for your reply. I'm sorry, I didn't see it until now. Your reply appears to assume that I will be tracking business expenses made with a personal payment account in the Personal profile. Since the Personal and Business profiles are no longer communicating, I will not spend time tracking personal expenses in Wave. How do I record business expenses paid with personal payment account on the Business side? Example: If I use Personal VISA to pay my business phone bill? What should it look like?
Like this?
Hey again @Canaczech
This would be handled by selecting the account type to be an equity account. In Wave this would be considered Money brought into your business by an account separate from the business account.
You can create an equity account called "personal Visa" or something of the sort and categorize your transaction's "account" drop down to this equity account. This will not show as an expense your business has made but rather an outside equity source. You'll then be able to categorize it accordingly!
If you're paying that amount back from your business to your personal, you can simply create an expense transaction from your business checking account and categorize it as a personal > Personal visa. Hope this helps!
HI. I have to agree. I think a video of this issue is much needed. I am reading through all of this and it's very confusing. The bottom line for me is understanding the reports. If choose "Share Equity...." will it ignore the transaction in all my reports. (Which is what I want.) I don't want to delete these transactions...since they may have nothing to do with my business. (For example. I may have accidentally bought groceries on my business account. I later transferred money into my business to make up for it.) You get the idea. PLEASE. make a video instead of having to scroll through these forums. The term "share equity" is confusing for us non-professional accountants. Thank you!
Hey @LIsa_Mia_Studios and welcome to Wave's Community Forum. Because the features in Wave are constantly evolving, having videos that are accurate is extremely difficult to create and maintain. In saying that, we are happy to help through the Community Forum as you have found!
In regards to the "Share Equity" option that you are referencing, can you actually upload a screenshot of where you are seeing this option? I ask because if you are seeing transactions that we for personal use but on a business card, then you shouldn't actually need to choose any of the equity options, as the "Personal" workflow (i.e. categorizing the transaction using the option for "Personal", should streamline the process). In saying that, the screenshot will help us to understand the flow that you are using and provide some guidance. Thanks in advance!
It almost seems easier to just delete non-business transactions from my personal account that I have flow in. I really didn't want to do that.
From my Business wave account, I imported from my bank: my business checking, savings, and also my personal checking account. I have sometimes purchased business items from my personal account every once and a while. So I was trying to exclude all those non-business things from my personal account and not have it count for any of the numbers or reports. Does that make sense?
So figuring out how to declare them that way was what I think we are all looking for in this forum. Help!
What would be the best way to account for a business expense paid for with a personal credit card? Hypothetical example, I owe property insurance on a rental that is $1165.00 and I pay it with a personal credit card. How would this look in Wave? The Personal credit card is not linked to my business account in wave, I simply would like to know how to account for it?? Is it frowned on as well? Commingling - breaking the corporate veil??? I have tried to obtain a business credit card but because it is a real estate type business, everybody is telling me I must wait 2 years. For my other Pool Business, I was approved in seconds for a healthy business credit card after being in business for 5 days for crying out loud. Please help! Thank you.
Hey @TODavid69! Great question. Typically, this wouldn't really be the best course of action, no. It's always going to be better-advised to have your business card handle these types of transactions, but it's not totally impossible to deal with. I'd say you might want to just split these types of transactions out within your account, to make sure you know that those had been paid with your personal card. Tracking those transactions properly and independently (say, with their own liability account in your Chart of Accounts) is going to be the best way to make sure that you can recoup your costs eventually and not be out of pocket from your personal card. I hope that makes sense!
I have the same question as others here, should I add a new equity account under Business Owner Contribution and Drawing or a new liability account under Due to You and Other Business Owners? The guidance above references an equity account, but in the program I am instructed that "all personal transactions must flow through a liability account."
Hi. am I understanding right that the ability to transfer transactions between business/personal profiles is no longer a thing. I am quite disappointed that this feature has been removed. It was a big time saver for having multiple business/ bank accounts with in a house hold. It would be handy even if at the least, the equity accounts for all the business showed up in the other business/personal profiles.... cause sometimes family's have lots of businesses and bank accounts
Hey there @just_me
At this present moment it has been removed due to a previous accounting/language layer which was not correct. We are looking at future ways to bring this back into our system (sorry no ETA) however in the meantime this is the current workaround!
Hello - Looking at using Wave so I've been reading the comments. I want to find out if personal transactions can or cannot be recorded as per the note above? (Sophia C. Updated: Friday at 15:33)
Has that ability been removed (BarsinA) or does that comment refer to something else? Thanks
Hi @Floss , thanks for your message. The above comments are referring to our old software system's version of recording personal transactions, which is not available anymore. The new way to record transactions in Wave as personal is to categorize the transaction as Owner's Investment/Drawing!
It's still a little unclear as to whether the Personal expense accounts should correspond with the Business accounts to separate expenses. I am particularly interested in this as regards a Sole Proprietorship. I understand moving it through the Owner's Investment/Drawing as the double-entry. Are we essentially keeping two sets of books?
...and further, if we are keeping two sets should we double the cash accounts to have them connected in both the Personal and the Business sides so that we can import detail in both sides? Then have the offset in Personal also be to Owner's Investment/Drawing?
@BarsinA - Thank for your answer on May 8, 2020 to @Canaczech . It was the answer I needed after reading this long thread.
Follow up question:
After categorizing transactions to the new Equity account ' personal Visa', (as stated it's not an business expense), how do you then create a report to send to your CPA, that shows it as an expense to deduct/include in a business category (say business meal & entertainment, business telephone, etc...)?. That is, how you do you make sure it's included in your Business P/L Statement, List of Transactions, etc for Business reporting to your CPA?
Thanks!
T@BarsinA To clarify my question, how you do you make sure it's included in your Business P/L Statement, etc for reporting to your CPA? Thanks.
Hi @cjDuggan , thanks for your message! To clarify, yes - this approach encourages keeping separate books, one for business and one for personal. This makes things a bit easier come tax time. If, for example, you want to record that you paid for a personal item with your business card, you would create the expense transaction and categorize it to Owner's Investment/Drawings. Then, on your personal bookkeeping, you would create an income transaction categorized as Owner's Investment/Drawings.
Hi @GlbInv , thanks for getting back! In this case, if a transaction is being marked as personal, it will not appear on your reports as a business expense in order to respect the previous 'personal' categorization.
Why not just use Owners Equity as the account you transfer personal money into and out of? Why do we need Owner's Investment/Drawings and/or Deposit from Personal and Personal Expense or Withdrawal? Also, where is "the transaction detail view"? Are these some kind of "sub-accounts" to Owners Equity? Thanks
Hey there @HonokaaBob
You could in theory, however the present method adds a language layer for it being a personal transaction until Wave reinstates a method of physically moving the transaction. They aren't technically sub accounts as Wave does not have sub accounts at this time, it's once again more of the language layer on the transaction side.
As a sole proprietor with a CapitalOne credit card, a comment.
Between this change and Wave's months now of inexcusable failure of its new data processor (Plaid) to support data linking with many major financial institutions, you have destroyed not only the basis of my accounting system, but irretrievably altered years of my past data that was maintained on your own recommended use of a linked Personal account. These changes happened with no notice, zero empathy, and no recourse.
I have no words for the amount of pain and wasted time involved. I cannot imagine treating users this way. Your language about it continues to mask the harm you have done, with words like "Simplified" about this feature, and with wilfully dishonest inclusion of data import interfaces for services you know won't work.
If I borrowed $800 from my personal money to use to buy materials for my business, I am supposed to use the "Owner investment/drawings" right? Then when I take that money back out, to repay my personal checking account, what do I do? I can't find it anywhere!
Hey there @ShelleysPots
When you're recording this on your business' side select a new income transaction > Make the account your business checking account (or wherever the funds have landed) > Categorize it as owners investment/drawing. Keep in mind however this is actually money that is put into your business. It's not considered a loan, but more of money your business didn't earn, but did gain from outside equity.
You might actually benefit from creating a loan account? However we as moderators are not accountants so I would either reach out to an accountant about that or you can post in our accounting threads.
Thanks for the input. I did categorize the money coming in as Owners investment. The confusion was in how to deal with taking it back out to repay our personal account. We ended up creating a liability account called loan from owner. I am going to check with my accountant to see if we are doing it right.
Hey @ShelleysPots
That creation of the account sounds like a good idea! I think you could use the same account owner investment/drawing. Essentially, whether it's an income or an expense will determine whether the account balances.
There are no words for how frustrating this thread is and for how upset I am at having to possibly start over with a new software because of this horrible change of removing personal accounts. Most people using this are not professional CPAs. We are small business owners who thought we had found a simplified way to do bookkeeping. Many, many small businesses frequently move money between accounts. I personally have 5 small business accounts as well as 3 personal which are all listed under one joint tax return as a sole proprietorship. This has been a nightmare trying to understand "owner equity, shares", etc. Please fix this.
Agree with @benwolfe about Plaid. Since it doesn't work with my community bank I'm pretty much screwed. If you contact Plaid they just tell you to ask your bank - as a rank and file customer - to make a major decision like working with a payment processor - on their behalf. Garbage.
I'm also still not clear, after reading this thread, how to record payments to self. I pay myself twice monthly through the bill pay function and am not sure how to categorize/handle that.
I don't have the owner's investment/drawing account described above. For a personal expense in the business account, my only option is: Shareholder Loan
If I click on create new account, the only option is:
Due to You and Other Business Owners
What do I do?
Isn't it better to just delete the transaction? Because it looks like if I categorize it as a personal expense, it is listed under "Liabilities" in the business, but it is a not a liability.
I have been searching this long thread of comments to help with my issue without success, so I am now a first time poster. I apologize if this info is buried in here but would love some help and a recap.
We are purchasing a home through an LLC, split between multiple members. The funds for the mortgage will be paid from a member's personal finances, adding to that member's equity within the LLC. How do I record this monthly (set of) transaction(s) in Wave?
Thanks!
Hey there @jskearney
This is a really great question that I would bring up to your accountant as well, however I'd likely recommend creating separate equity accounts in your Wave business:
Owner A contributions
Owner B contributions
Owner C contributions
Each payment made from your LLC business should be categorized as their respective business owners contribution. See example below:
-Be sure to set the account to be your equity accounts you created for each contributor, and change the description as well. Select the Mortgage category.
Hope this helps!
@Barsin - Shouldn't the mortgage be a credit (withdrawal) for 500,000? Liabilities should have credit not debit balances. And all of the payments by owners should be "deposits" or debits to the mortgage, but credits (increases) to their capital contributions.