PayPal and Your Bookkeeping

07 Mar PayPal and Your Bookkeeping

Adding a Paypal account to Quickbooks:

Paypal when used for business to collect payment from customers, and possibly to pay vendors, operates just like a bank account and must be treated as such in your bookkeeping.

To incorporate your paypal account into your bookkeeping:
1. Be sure to set up your Paypal account using the tax i.d. and business name associated with your business and if you have multiple businesses set up multiple Paypal accounts.
2. Add a new bank account to your chart of accounts in your bookkeeping system and call it PayPal.
3. Update this Paypal bank account as you would any other.
a. Post deposits using the deposit window,
b. post debits for fees using the write checks window,
c. post transfers to your operating account using the transfer option.
4. Reconcile your paypal account monthly as you would a regular bank account.