Sort a month of bank transactions into expense categories (you check, your accountant decides)
Paste a month of bank transactions and the AI suggests a category for each, totals them, and lists the ones it can't tell, so you start your bookkeeping with a draft instead of a blank sheet.
- Setup
- 15 min
- Saves
- About 45 min a use (our estimate)
- Level
- Medium
- Last checked
- Works with
- Any AI chat, Spreadsheet, QuickBooks Online
- Step in a real app
- Described from the official help page, not run on a real account
Run once on made-up data on with Claude. One run, not proof.
Version 1 · Draft: not yet approved by the owner · How we testWhat this does
The AI suggests a category for each bank transaction, totals them, and puts anything unclear on an "ask" list. You fix the draft, and your accountant makes the final call.
This is not financial or tax advice. Whether something is a business expense, and where it goes, is for your accountant to decide.
Before you start
- Any AI chat (ChatGPT, Claude, Gemini or Copilot).
- One month's bank or card export as CSV.
- Your accountant's category list (for Schedule C filers, often its expense line names).
- Setup time: about 15 minutes the first time (our estimate).
- Privacy: delete account and card numbers and balances first, and shorten descriptions that reveal private things.
Steps
- Download the month as CSV, keeping only date, description and amount.
- List your categories, using the names in your books.
- Paste the prompt into a new AI chat, then the list and transactions.
- Answer every ASK item from receipts. Check each Low or Medium guess.
- Re-add the totals in a spreadsheet.
- Enter the categories in your books. In QuickBooks Online, use the Pending tab under Bank transactions to post or change each one. Bank rules can auto-post, so start with simple repeats like rent.
- Save the ASK list for your accountant.
The prompt
Help me sort one month of bank transactions into expense categories. This is a draft. My accountant decides the final categories. Use only what I give you. Don't send anything. My business: [what you do, in one line] My categories: [list, e.g., Parts and supplies; Fuel; Software; Licenses and fees; Insurance; Contract labor; Meals; Phone; Advertising] For each transaction: 1. Suggest one category from my list only. Don't make up new ones. 2. Rate your confidence: High, Medium or Low, with a few words why. 3. If it could be personal, mixed or could fit two categories, put ASK and say what I should check. 4. Mark deposits as "Income: not an expense" and transfers between my accounts as "Transfer: not an expense". Then: - Give a total for each category, and a separate ASK total. - Check that your totals add up to all money out, minus transfers. - List my ASK questions in one place. Don't give tax advice. Don't say what's deductible. Transactions (date, description, amount): [paste CSV]
Before and after: the made-up input, then the real output the AI gave us.
Try it with made-up data
Fernwood Mobile Bike Repair (made up), March 2030, categories as in the prompt example.
2030-03-01,PAYPAL *PARTSHUB,-212.40
2030-03-02,SHELL OIL 5521,-58.90
2030-03-04,DEPOSIT SQUARE INC,1340.00
2030-03-05,ADOBE *CREATIVE CLD,-22.99
2030-03-08,COSTCO WHSE #0412,-146.75
2030-03-10,FERNWOOD CITY LICENSE,-75.00
2030-03-12,STATEFARM INS,-96.00
2030-03-15,VENMO *J ALVAREZ,-300.00
2030-03-18,ACE HARDWARE,-34.18
2030-03-20,JOES DINER,-41.60
2030-03-22,TRANSFER TO SAVINGS,-500.00
2030-03-25,VERIZON WIRELESS,-85.00
2030-03-28,SHELL OIL 5521,-61.25What the AI gave us
Date Description Amount Category Confidence 03-01 PayPal PartsHub 212.40 Parts and supplies Medium: name suggests parts; PayPal hides detail 03-02 Shell 58.90 Fuel High, if the vehicle is for business 03-04 Square deposit 1,340.00 Income: not an expense 03-05 Adobe 22.99 Software High 03-08 Costco 146.75 ASK Could be supplies, personal or mixed 03-10 City license 75.00 Licenses and fees High 03-12 State Farm 96.00 Insurance Medium: business or personal policy? 03-15 Venmo J Alvarez 300.00 ASK Could be contract labor or personal 03-18 Ace Hardware 34.18 Parts and supplies Medium 03-20 Joe's Diner 41.60 Meals Low: who and what business purpose? 03-22 Transfer to savings 500.00 Transfer: not an expense 03-25 Verizon 85.00 Phone Medium: business-only line? 03-28 Shell 61.25 Fuel High Totals: Parts and supplies $246.58 · Fuel $120.15 · Software $22.99 · Licenses and fees $75.00 · Insurance $96.00 · Phone $85.00 · Meals $41.60 · ASK $446.75. All add to $1,134.07, which equals money out ($1,634.07) minus the $500.00 transfer.
ASK: What was bought at Costco? Who is J Alvarez and what was the $300 for? Was the diner a business meal? Are the insurance and phone business-only?
Good: it kept income and the transfer out of expenses, and its totals added up. But it broke its own rule: insurance, the diner and the phone bill may be personal or mixed, so the prompt says they go under ASK. Instead it categorized them anyway. The same goes for both Shell fill-ups: "High, if the vehicle is for business" rests on a fact nobody gave it. Moved to ASK, those three ($222.60) raise ASK from $446.75 to $669.35, and Insurance, Meals and Phone drop to $0 until you check. If the vehicle's business use isn't confirmed either, the fuel ($120.15) goes to ASK too, making it $789.50 with Fuel at $0. A person still had to answer every ASK question, with the accountant deciding the hard ones.
Check before you send
- Every transaction appears once, with no amounts changed.
- Income and transfers are not counted as expenses.
- Anything possibly personal or mixed is under ASK.
- Each ASK item is answered or saved for your accountant.
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Don't paste
- Account, routing or card numbers, and running balances.
- Your Social Security number or tax ID.
- Personal purchases unrelated to the business.
- Logins of any kind.
When not to use this
- As your final books or tax filing.
- For payroll, sales tax or loan items you don't understand.
- For a big year-end batch. Do one month at a time.
Questions owners ask
Can AI do my bookkeeping?
It can draft categories. You confirm each entry, and an accountant makes tax decisions.
Is it safe to paste my bank statement into ChatGPT?
Paste only date, description and amount, and first shorten any description that reveals something private, such as a doctor's office or a person's name. Privacy settings don't make sensitive details safe to paste.
Sources
Related guides
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