How do I reverse a a payment entered against an invoice that was not paid and entered in error?

I appreciate your effort in seeking assistance in the Community forum, Helen. Let's go through the process of correcting the incorrectly recorded payment against an invoice in QuickBooks Online (QBO).

To begin, there's no need to delete and re-enter the invoice. You'll only need to void or delete the incorrect payment applied to it. This process will change the status of your invoice back to open (unpaid), reversing the payment.

Here's how to locate the payment and undo it:

1. Log in to your QBO and go to the Sales menu.
2. Navigate to the Sales transactions tab.
3. Use the filter options to streamline your search for the specific invoice payment.
4. Pick the Money received option to view all payments.
5. Locate the payment in question and click the drop-down arrow next to the View/Edit option.
6. Choose either Void or Delete as appropriate.   

If you're unsure whether you need to void or delete the transaction, check out this article: Void or delete transactions in QuickBooks.

After completing these steps, return to the original invoice and verify that the payment has been successfully reversed. If you need further assistance or have any other QBO-related concerns, tap the Reply button below.