🛠 QuickBooks Online Tip for Home Service Pros: How to Categorize Transactions
Running a home service business means you're constantly juggling client jobs, materials, and scheduling. But if your transactions are a mess in QuickBooks Online (QBO), it can lead to bigger issues—especially at tax time.
Learning to categorize your transactions properly helps you stay organized, see where your money is going, and keep more of it.
Why It Matters
Tracks job costs and profitability by service
Makes tax deductions easy to claim (tools, mileage, uniforms, etc.)
Gives you clear, accurate reports for better decision-making
🧰 How to Categorize in QBO (Step-by-Step)
Go to the Banking tab
You’ll see transactions from your connected business accounts.Click each transaction and assign a category
For example:Materials → “Job Supplies”
Gas → “Vehicle Expenses”
Client payments → “Service Income”
Use tags or memos to note the client or job
Create bank rules
Automate categorization for regular vendors like Lowe’s, Home Depot, or gas stations.Review your reports monthly
Especially your Profit & Loss and Job Costing summaries.
Tips for Home Service Businesses
Keep separate categories for labor, subcontractors, and supplies
Log mileage or vehicle use (standard deduction or actual expenses)
Review expenses by job to identify your most profitable services
FAQ
Can I deduct tools I bought this year?
Yes—tools, equipment, and safety gear are all deductible business expenses.
How do I track income for multiple jobs per week?
Use job tags or client names in memos to track revenue by service.
What about fuel and vehicle costs?
You can deduct either standard mileage or actual vehicle expenses—just keep a detailed log.
Can someone help me get my books organized?
Absolutely. Let a pro walk you through it.
🧰 Need help cleaning up your QuickBooks or setting it up right?
Book a free call with Dr. Bryan Raya, QuickBooks ProAdvisor:
👉 https://calendly.com/dbr_bookkeeping/book-a-free-call-with-dbr
Let’s start Doing Business Right.
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