How do I void a bill payment check in a closed period without affecting the closed financials and then reissue the payment in the current period?

[lbailey2]

apparently I didn't state the question right, after multiple attempts.  Yes, I read everything.  The voided check was in April, the check had to be reissued in May.  Fiscal year ends December.   It appears to me that the 1099 for this year will pick up both the voided check and the reissued check, but not the journal entry that offsets the voided check - under the above method.  Therefore the 1099 for the current year will be wrong.  but no worries, I corrected that by voided the check AND replacing it in April to keep the integrity of the April statements.  Then I reissued the check in the correct amount in May.  So under this even more cumbersome method, April and May financials are still correct in and of themselves AND the 1099 will issue correctly at the end of the year.   Yes, a very simple banking issue caused a huge mess with prior period reporting and future 1099 issuance.  All would be corrected if quickbooks would let us simply choose the date a void should be posted.  I was hoping for a more simple way.  But the way I corrected it works.  Thanks for your comments

[qbteachmt]

"The voided check was in April,"

You don't Void anything; you offset the check that won't clear with a Deposit to a Liability account. Then, you repay that by paying out the Liability.

"It appears to me that the 1099 for this year will pick up both the voided check and the reissued check"

No, it won't. First, something Void no longer exists with a Value. Second, you never show you paid the Expense twice. This replacement check is Banking, as Liability = money owed to another.

"but not the journal entry that offsets the voided check - under the above method."

That's why it is the Wrong way to do this. You are simply making all of this much harder than it is.

[lbailey2]

"You don't void anything" conflicts with "something void no longer exists with a value".  The void is necessary so that the 1099 will not pick up the incorrect check.  I was looking for a simpler solution for sure.  but your solution doesn't work unless the vendor will not be receiving a 1099.  Because if you don't void the original check that was for the wrong amount, it will be included in the 1099.

[qbteachmt]

You should not VOID something, because you literally Removed the values it contributed to your financial data.

It is not Necessary to VOID a lost check; you are turning a Banking issue into one that now impacts historic financial reporting, expense and banking, as well as 1099-Misc reporting.

"Because if you don't void the original check that was for the wrong amount, it will be included in the 1099."

Are you In the Right Topic for your question? Because this original topic has to do with replacing a lost check.

Don't turn a simply banking issue into a Full on amended reporting need. All we have is a Lost check, so you Deposit that amount as a Liability still needing to be paid to another. Now your Deposit and your Original Check clear against each other to 0, next reconciliation = they are taken care of.

Then, you Pay out that liability to party still owed the Funds. That is not an expense, again. It is just replacing a lost check.

[GA]

OMG, I sympathize with all of us trying to void a check.  QBO really makes it complicated.  I totally agree with the statement "...All would be corrected if quickbooks would let us simply choose the date a void should be posted...".  Well said!!!

[qbteachmt]

Do not VOID anything. By Voiding, you just changed your financial data. This topic is not a VOID topic; it is a "I need to Replace the Check" topic. That is not Expense, again. This is just Banking. Don't make it worse.

[lbailey2]

Thank you "accounting"!   You must have gone through something similar, since you clearly understand the end result with the 1099s.  QB could simplify this.  Until then, the complex workaround is all we can do

[qbteachmt]

The point is, this is Not New Expense, and it doesn't affect 1099. It is a Replacement for lost funds; not Expense in the new year. 10909-Misc has no bearing on this.

[lbailey2]

QBteachmt, what you don't understand is that if you don't void the original checks then both checks will be included in the 1099 at year end

[qbteachmt]

@lbailey

The reason I keep repeating "This is not Expense" is that the replacement check is Not Expense. You do not Map the Other Current Liability account for 1099-Misc reporting. It is Not Expense, it is not payment for services, it is not Reported. That's what you are likely doing wrong in your own file.

[haskenazi1]

@qbteachmt 

Your solution seems sound and right to me, but does it work if the funds from the first check (the one that never made it to the recipient) has not yet been refunded by the bank before the replacement check was issued?

In that case, in addition to depositing to a liability account to track a payment still owed (bc vendor never received the check), dont we also need to track the payment that will increase our bank account once the bank refunds the money? (bc we haven't received it yet)

[haskenazi1]

Also, in your example, does it have to be deposited to "other liability"? OR can it be deposited to A/P?

[Anonymous]

Thanks for joining the discussion @haskenazi1. I can help share some insights about the replacement check.

Yes, qbteachmt's answer is applicable in your given scenario as well. Once the bank refunds the money, you can track the payment by making a deposit.

In the given example, you'll need to deposit it to liability to show that you still have a payable. Then create another check and post it to the same liability to zero it out.

That should do it. If you may need some references in the future, please feel free to access our site: Help articles for QuickBooks Desktop.

Let me know if you have other questions about bill payments. I'm here to help however I can.

[agagne]

What if no replacement check is to be issued?  Code the deposit to the expense?

[HoneyLynn_G]

I want to provide the best way to record your transactions, @agagne. I will just need more details.

With your statement, "What if no replacement check is to be issued?"do you mean that you're not paying the vendor, or there is no liable bill? Are you planning to enter it as a bill credit?

There are several ways to enter a refund for vendors. Instead of sending a check back to the vendor, you can enter it as a vendor credit to be used for future transactions or apply the credit to a current bill to make a payment. For now, you can check the link below to learn more and get the detailed instruction.

Record a vendor refund in QuickBooks Desktop

If you're referring to something else, please let me know by clicking the "Reply" button. I'm here to ensure your success. 

[haskenazi1]

I'm just not following @qbteachmt answer is applicable in the case where the bank has not yet returned the money for the check that was deposited fraudulently. In this case, we need to somehow add a receivable from the bank to track the money they will owe once they close their investigation and refund the fraudulent check. I don't think the current solution takes this part into account.  I think it only works if the refund has already posted.

Any thoughts?

[JonpriL]

Hello @haskenazi1,

My colleague, @Alessandra_B shared her answer about the same question you've posted.

If you  haven't check it yet, you can follow this link: https://quickbooks.intuit.com/community/Payments/Fraudulently-Deposited-Check-to-Vendor/m-p/286493#M...

It'll be always my pleasure to help if you have any other questions. I'll be always around to help.

[chessiecat32]

Um, qbteachmt, I'm missing something here. "The opposite of a check is a Deposit to an Other Liability account, dated now." I created an other current liability account named Bill Payment Offset and tried to make a deposit to it - couldn't do it. Make Deposits doesn't show Other Liability accounts in the drop-down box.  I tried entering a deposit directly into this liability account by typing the dollar amount under the Increase side of the transaction, and QuickBooks  designated it a General Journal entry. Am I misunderstanding you?

I  should tell you that I made a deposit into the bank account where the original check was issued, dated it today, used the vendor name as the Name so it appears in the Vendor Information as a deposit offsetting the amount of the check. However, I still need to get the bill balance back to the original number somehow.  Will this happen when I reconcile the check and the deposit? Thanks in advance for your clarification.

[RaymondJayO]

Hello there, @chessiecat32, 

Qbteachmt's answer is applicable if you want to void a bill payment check that was never received by your vendor in a closed period. 

Since you've made a deposit and posted it to your Bill Payment Offset account, the system will automatically create a general journal entry with an increasing balance to your vendor. Please see the screenshot below for your reference. 

To help fix this, you'll need to change the posting account of your deposit into the Accounts Payable (A/P) account. Then, open the bill payment check and apply it to the deposit. This way, the bill balance gets back to the original number. Here's how: 

1. Go to the Vendors menu at the top. 
2. Select Vendor Center.
3. Choose the vendor's name.
4. In the Transactions tab, double-click the check (Bill Pmt-Check).
5. Check the correct deposit in the Bills Paid In This Transaction section. 
6. Click Save & Close.
7. Click Yes to confirm. 
    

For more information about this process, you can visit this article: Pay Bills in QuickBooks Desktop. After that, you can now reconcile your account in the program. 

With these resources, I'm confident that you'll be all set with your bill payments and reconciling your account in no time, @chessiecat32. 

Stay in touch with me if there's anything else I can help you with. Wishing you and your business all the best.

[chessiecat32]

Thank you, RaymondJayO. I'll give it a try today and get back to you with the results. ChessieCat

[chessiecat32]

THANKS, RaymondJayO! Couldn't get to it yesterday -too busy- but I did it today and it worked fine. I  opened my deposit and changed my From Account choice to my A/P account, then it showed up when I double-clicked the outstanding bill payment- check so I could select the deposit instead of the original bill. Now the bill is back to the original amount and I can offset the o/s bill payment with the deposit when I reconcile. Neat trick! You've been a big help!

[RaymondJayO]

I'm happy that your issue about offsetting the bill payment with the deposit is now resolved, @chessiecat32. 

It's a great idea that you reconcile your account in the program on a regular basis to ensure accuracy of your accounting records. In case you encountered reconciliation discrepancies in the future, I'd suggest running any of these reports to serve as your reference to fix them. 

• Reconcile Discrepancy report
• Audit Trail report
• Previous Reconciliation Report

For more information about this process, you can visit this helpful article: Fix Reconciliation Discrepancies. 

You can freely navigate these helpful topics on our Community page if you have other product-related concerns. 

The information above will help guide you during the reconciliation process, @chessiecat32. 

Please know that I'm always here to help if you need further assistance. Have an awesome day. 

[chessiecat32]

Thank you, I do my reconciliations every month.

[chessiecat32]

ADJUSTING ENTRY TO REMOVE A SMALL OVERPAYMENT

[Anonymous]

Welcome back, @chessiecat32,

I can share some information about correcting overpayments in QuickBooks Online.

Before creating any correcting entries, I'd suggest consulting an accountant to help and guide how to record them and what accounts to use. Your accountant can provide more expert advice in dealing with this concern.

You can follow these steps to correct an overpayment for the Accounts Receivable account:

1. Click the Company menu.
2. Choose Make General Journal Entry.
3. In the Make General Journal Entries window, update the Date and Entry No fields if necessary.
4. Go to the Account field and select Accounts Receivable from the drop down list.
5. Add the amount under Debit column.
6. Tab to the Name column and select a Customer Name from the list.
7. Next, select the offset account and enter the amount on the Credit column.

To correct a vendor overpayment, perform these steps:

1. Tap the Company menu and select Make General Journal Entry.
2. In the Account column, select Accounts Payable.
3. Input the amount under Credit column.
4. In the Name column, pick a vendor name.
5. Go to the next line and key in the offset account and enter the amount under Debit column.

I've added here an article to guide you with the correction: Write off customer and vendor balances.

That should do it, @chessiecat32. Please let me know once you've tried the steps. I'll be more than happy to help if you need one. All the best!