How to Properly Reimburse Ownner Expenditures in QuickBooks
A reader wrote to ask for help in creating transactions for a startup business that doesn't yet have enough cash flow to support all expenses. The owner of the company is paying some subcontractors personally, and will be reimbursed when there is sufficient money. The reader creates a QuickBooks journal entry that credits the owner's equity contribution account and debits the Subcontractor expense. He enters the vendor's name on the JE lines. The 1099 report for the vendor shows zero 1099 payments.
This transaction is "washing" the vendor's 1099 payments (entering both a credit and a debit) because the vendor's name is on both lines. Enter the vendor's name only on the QuickBooks GJE line that debits the expense.
Another way to accomplish this is to create a QuickBooks liability account named "Owed to Owner" and use that instead of the equity account. In fact, if this is a corporation a liability account named Owed to Officer is necessary (because there's no Draw or Contra-Draw account).