QBO category for late fee on invoice that we are not billing to client but paying ourselves

In QuickBooks Online (QBO), if you incur a late fee on an invoice that you are not passing on to a client but are paying yourself, you should categorize it as an expense. Here’s how you can handle it: 1. **Expense Category**: You can create a specific expense account for tracking such fees. A common practice is to categorize it under "Bank Charges" or "Miscellaneous Expenses." If you frequently incur late fees, you might consider creating a dedicated account called "Late Fees" for better tracking. 2. **Recording the Expense**: - Go to the "Expenses" tab in QBO. - Click on "New Transaction" and select "Expense." - Enter the details of the late fee, including the amount and the vendor or service provider charging the fee. - In the "Category" field, select the appropriate expense account (e.g., "Bank Charges" or "Late Fees"). 3. **Documentation**: Keep any documentation or statements related to the late fee for your records. This can be helpful for bookkeeping and in case of any future inquiries. By categorizing the late fee as an expense, you ensure that it is accurately reflected in your financial statements, helping you maintain a clear picture of your business's financial health.

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