Re: [GNC] How to best set up account structure for multiple Tax IDs?
My bad the credit column got wiped off by nabble wrap at 75 chars. There was generally a credit row for each of the debit rows shown but it now appears as an extreme left column. - David Cousens -- Sent from: http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
On Mon, 3 Sep 2018 09:42:56 -0400 Jens Dill wrote: > So I have at least 5 pots of money: the two trusts, the two > businesses and my personal funds (cash, bank accounts, and IRAs). > Each has its own liabilities, assets, income, expenses, and equity. Currently I am "only" managing 4 entities. I have four files, one for each set of books and each is allowed a certain space on my monitor so I can have all four open at once. For many years I only used the one credit card, but now have a (major company) debit card on the business account, so the number of entries where I paid from personal funds and eventually paid it back "Liability:Internal Loan" is now minimal, and reflects cash transactions usually. I don't worry about the business features for this use of Gnucash. As I am in charge of the file, I can just check the balance of the liability account and decide whether to pay myself that money or not. However, each entity has at least one bank account - as I have been doing this for a long time, I have accumulated some assets. The concept that you are using a single bank account for your personal and business at present pushes you into having to combine the the data so you can reconcile the account. I'm not in your jurisdiction, but I strongly advice untangling your business and personal bank accounts and financial recording. Mike Novack will give you many good reasons for this, including when you sell the business not exposing your personal accounts to scrutiny when displaying the profitability of your enterprise. Liz ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
Jens, If you were to try and maintain enough separation of the affairs of your companies and trusts in one set of books, you would have to duplicate the transactions in any case. To keep a record of what is paid for from your personal account for each entity you would need to run a virtual bank account for each entity in any case as you have to record the transfer to the equity of that entity even though you may only have one real bank account e.g you purchase letterhead for LLC1 from your personal bank account for $100. You cannot simply record that as Debit Credit Asset:Personal:Bank 100 Expense:LLC1:Office:Expenses 100 Doing this you have no record of the transfer of money between the entities. True your accountant could sort it out and would do so by creating record like those given below. As someone else pointed out she/he will charge handsomely for doing so. To keep the separation of the entities you would have to have something like this even in a single book/file Debit Credit Asset:Personal:Bank 100 Asset:Personal:Investment:LLC1 100 Asset:LLC1:VirtualBank 100 Equity:LLC1:OwnerContributions 100 Asset:LLC1:VirtualBank 100 Expense:LLC1:OfficeSupplies 100 If you maintain separate files for your entities the first two entries would be in your personal.gnucash file/book and the other four entries would be in the LLC1.gnucash file/book and you would drop the entity. Effectively there would be no real duplication of effort. For money received by each entity the transactions would have to have a similar structure ( with debits and credits reversed and an Income account for each entity instead of an expense account). I don't know about Windows or Macs but on Linux Mint the icons in the toolbar showup with the first few letters of the filename so if you choose the filenames wisely it is fairly easy to bring up the set of books you want to make the entries in separate books while opening each file in a separate instance of gnucash. If you have enough RAM you can leave all the files open simultaneously andjust switch between them as required. In that single book/file for each matching split in a transaction you would have a huge list come up in the account selection field, not organised by entity, from which you have to select the appropriate destination account for the second split. The scope for error is large and the time involved in sorting out errors will be demanding. Hope this helps clarify why those of us with a bit of accounting experience and/or practice recommend using separate files for each entity. - David Cousens -- Sent from: http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
On 9/3/2018 12:33 PM, Jens Dill wrote: On 2018-09-03 12:28 PM, Jens Dill wrote: And, I should add, my CPA has told me she would be perfectly happy if I kept everything in spreadsheets. Sure she would. You are paying her for her time. But do not sell spread sheets short. If you had learned bookkeeping back i n the old pen and ink on paper days you would immediately realize that you COULD have some spread sheets with columns matching the ruled lines on traditional ledger and journal paper or in more modern ledger with running balance format. The spreadsheet app could prevent arithmetic errors. And you could have it all in one with division into entities. But your spreadsheet would be VERY wide (awkward to view) and not protect you from entering transactions that were not in balance. Gnucash is "virtual journal" bookkeeping, you enter transactions directly into the ledger, it will tell you if entered not in balance (something will show up in Imbalance) Up to you of course, but I would keep separate books. If my bank would not give me multiple accounts, might check on other banks. Perhaps the same with the credit card, especially if the business credit cards are not carrying balance. It might seem like a lot of extra time entering what you see as "duplicate" but consider the amount of time spent figuring out even one instance where something got entered incorrectly. Michael D Novack ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
I’m not certain about allowable characters but the Account Code is used for sorting. Formal accounting procedures use somewhat standardized charts of accounts which are coded by number. All asset accounts are in a certain range, liabilities in their own range, etc. Rather than refer to accounts by name, accountants use the codes to specify how a transaction is classified. In some systems the name might not even be readily visible, only the code. You’re free to use the code field or not. Regards, Adrien > On Sep 3, 2018, at 8:42 AM, Jens Dill wrote: > > > And a final observation. It would be nice if the documentation spelled out > somewhere the purpose and uses of the "Account Code". I don't remember any > explicit references to it in the Tutorial, and there is no description of its > use in the Help pages. All I can find is some oblique references in the Wiki > and related documents that it can be used to create a sort order for siblings > within the account hierarchy, and that the order is determined by treating > the code as a base-36 number with digits "0-9A-Z". From this I can infer that > the account code must be case-insensitive and that punctuation marks are > either illegal, ignored, or cause weird effects. It would be nice if this > were explicitly documented. And if there are any other uses of the Account > Code besides sorting, those should be explained somewhere as well. If it is > only used for sorting purposes, perhaps it should be renamed to suggest that > use. Otherwise it is a puzzle for someone trying to set up an account for the > first time. > >-- Jens ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
On 2018-09-03 12:28 PM, Jens Dill wrote: On 2018-09-03 11:52 AM, David Cousens wrote: This is strictly an accounting question as the accounting solution will be very dependent upon the legislation governing the trust in your jurisdiction Your point is well taken. I am consulting my CPA. But the purpose of my bookkeeping is simply to organize the information to feed to the CPA, who will presumably keep the proper books for tax purposes. And, I should add, my CPA has told me she would be perfectly happy if I kept everything in spreadsheets. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
On 2018-09-03 11:52 AM, David Cousens wrote: This is strictly an accounting question as the accounting solution will be very dependent upon the legislation governing the trust in your jurisdiction Your point is well taken. I am consulting my CPA. But the purpose of my bookkeeping is simply to organize the information to feed to the CPA, who will presumably keep the proper books for tax purposes. You can run with multiple instances of GnuCash, open at the same time so it is concievable to operate several books and switch between them as required to create the corresponding entries in each set of books when you transfer money between entities . The problem here is duplication of effort. I will be paying business expenses with my personal checking account and credit cards. Those accounts need to be managed in my "Personal" domain, and there is no need to duplicate them in each of my business entities. If I go with multiple instances of GnuCash, then each business purchase gets entered at least three times, once in my personal entity as a transaction on the checkbook or credit card statement, again in my personal entity under Accounts Receivable, then as an Accounts Payable in my Business entity. All very well and good and proper, but two or three times as much work as entering it once. And the Accounts Receivable entry in one entity is never automatically cross-checked or balanced with the Accounts Payable entry in the other entity. So I'm losing the power of GnuCash to manage my double-entry bookkeeping for me in this critical and frequently-occuring situation. -- Jens ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
Jens, This is strictly an accounting question as the accounting solution will be very dependent upon the legislation governing the trust in your jurisdiction. Generally speaking an entity whch has to file a separate tax return is likely to be a separate legal entity and as such should really have its own set of books. As you indicated there is no entity top level in GnuCash so the only way you could keep the accounts in a single book is as you proposed using subaccounts for each entity under the top level accounts. This would make producing separate reports for each entity fairly complex. Becasue of the possible legal implications with the trusts, I would consult an accountant and/or lawyer familiar with your jurisdiction, who can advise you how the records should be kept for legal compliance and whether books should be totally separate. There are usually fairly serious sanctions on a trustee if you do the wrong thing with trust accounts, even accidentally. You can run with multiple instances of GnuCash, open at the same time so it is concievable to operate several books and switch between them as required to create the corresponding entries in each set of books when you transfer money between entities . David Cousens - David Cousens -- Sent from: http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] How to best set up account structure for multiple Tax IDs?
On Monday, September 3, 2018 8:42:56 AM -05 Jens Dill wrote: ..snip > > So I have at least 5 pots of money: the two trusts, the two businesses > and my personal funds (cash, bank accounts, and IRAs). Each has its own > liabilities, assets, income, expenses, and equity. I've rejected the > "simple" solution of having 5 different GnuCash files because it's all > my money and I know I'm going to be doing a lot of moving money back and > forth between the different pots. For instance, it makes no sense to > have separate checking accounts or credit cards for the businesses at > this stage, so all business expenses will be paid with personal or trust > money. And the net income from the businesses and the trusts is personal > income, so goes back into my bank account. ..snip I would recommend to use the "simple" solution: - Different Tax entities will have different tax treatment of expenses, withdrawals etc. Having everything under "one set of book" will make your accountant life's difficult and yours when you have to give him different reports including/excluding transactions from different entities. - I do not think mixing business and personal accounts is a good idea either even with an LLC - Many more reasons outside the scope of gnucash and - I do not think gnucash was designed to keep completely different COAs for different entities under the same file/database. You could keep different sub-accounts of the same type of account for each entity say: Equity --Equity from business -- Equity from trust 1 But this would be as complicated or more as keeping different gnucash books. But do not take my word for it, consult your CPA. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
[GNC] How to best set up account structure for multiple Tax IDs?
I'm new to GnuCash. I need an accounting package because I am now in the position of having four different tax identification numbers (and thus four different tax returns to prepare). Briefly, the situation is that I'm recently widowed. My wife and I had a living trust, and on her death the trust split into two parts: the Survivor's trust, which is money I can use for any purpose, and the Marital trust, which is set aside to guarantee that her share of the estate has a chance of getting to her heirs. The Marital trust has its own tax ID. I've also purchased an acrigultural property, on which I plan to build a non-farm business and continue farming the remainder of the land. I've set up both the farm and the business as separate sole proprietorship LLCs, each with its own tax ID. So I have at least 5 pots of money: the two trusts, the two businesses and my personal funds (cash, bank accounts, and IRAs). Each has its own liabilities, assets, income, expenses, and equity. I've rejected the "simple" solution of having 5 different GnuCash files because it's all my money and I know I'm going to be doing a lot of moving money back and forth between the different pots. For instance, it makes no sense to have separate checking accounts or credit cards for the businesses at this stage, so all business expenses will be paid with personal or trust money. And the net income from the businesses and the trusts is personal income, so goes back into my bank account. If I set things up with the traditional 5 top-level accounts, I have to create 5 nearly identical sub-accounts under each in order to divide things up. It might be better to make one top-level "account" for each entity, and set up liabilities, assets, income, expenses, and equity as sub-accounts of each. But you can't do that, because the top-level "accounts" are not really accounts in the sense of having an account type. If I assign them an account type, which I am required to do, I'm restricted in the types of subaccounts I can put under them. There is no account type that allows all other account types among its subaccounts. So it seems I can only go with the first plan: set up the traditional 5 top-level accounts (liabilities, assets, income, expenses, and equity) and divide each into a subaccount for each entity. GnuCash seems to have no problem with using the same name for a subaccount in two different branches of the account tree, which is helpful. So this will be time-consuming to set up (can't use the Druid, and there does not seem to be a way to copy and paste account subtrees) but it should work. I have not yet investigated whether I can get individual entity reports by selecting, say, all accounts with the second level having the same name, but I presume I can eventually make that work. My questions: 1. Has anyone else faced this situation? 2. What solutions did they find? 3. How did their solution work? 4. Is my approach sensible? 5. Is it likely to work? And a final observation. It would be nice if the documentation spelled out somewhere the purpose and uses of the "Account Code". I don't remember any explicit references to it in the Tutorial, and there is no description of its use in the Help pages. All I can find is some oblique references in the Wiki and related documents that it can be used to create a sort order for siblings within the account hierarchy, and that the order is determined by treating the code as a base-36 number with digits "0-9A-Z". From this I can infer that the account code must be case-insensitive and that punctuation marks are either illegal, ignored, or cause weird effects. It would be nice if this were explicitly documented. And if there are any other uses of the Account Code besides sorting, those should be explained somewhere as well. If it is only used for sorting purposes, perhaps it should be renamed to suggest that use. Otherwise it is a puzzle for someone trying to set up an account for the first time. -- Jens ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
