PayPal Fees

but what expense category would you use? 

Is there a way to AUTOMATE this paypal fee for all paypal expenses? For example, on the Receive Payments screen, there are several icons to categorize the type of payment, including Check, Credit Card, E-check. One can add new types under the More icon. Can we then set a RULE that if payments come in this way, the paypal fee is automatically generated and recorded? In this day where e-commerce is soon going to outstrip traditional payment methods, QB/Intuit has probably already come up with such a method, or, I hope and trust, will sonn.

Good afternoon, sbraver.

I have some insight I'd like to share with you about bank rules. In both QuickBooks Online and QuickBooks Desktop, bank rules allow you to pre-customize transactions as they come in via Bank Feeds. Both platforms allow for auto-assigning a payee and an income/expense account. QuickBooks Online goes a little further by adding the extra layer for a Class, Location, and a Memo field. If you'd like to read more, I'm attaching the articles on Bank Feeds for both Desktop and Online down below. If you have any additional questions about this, feel free to reach out to me.

Online: https://community.intuit.com/articles/1145469-banking-rules-and-recognition-for-downloaded-transacti...

Desktop: https://community.intuit.com/articles/1550952-use-renaming-rules-for-bank-feeds

Hello

Up until now I have always avoided offering Paypal as a customer payment option, as Paypal draws out charges/commission on a sale by sale basis. It is so much easier to apply exact payments to every invoice, paying bank merchant fees on a monthly basis, separate from the invoice transactions themselves. I read your linked suggestions, but still do not understand how to set things up to (easily - ie., easy enough for my employees too) receive Paypal payments on Quickbooks invoices.

Any help appreciated, thank you

Hi James

Currently our method for receiving credit card payments for goods, is as follows:

1. Customers salesorder placed online with credit card, which is pre-approved by Authorize.net

2. Goods selected, shipping calculated etc, invoice created.

3. Payments captured online on www.Authorize.net 

4. In QuickBooks: Customers > Receive Payments > Payment Amount (exact amount of payment entered) > Save

5. Invoice printed, date-stamped PAID by QuickBooks, and included with shipment.

Employees do all of this easily.

Every evening I go into QuickBooks and make the deposits, separating the different payment methods into separate deposits, etc.

My concern is how to easily implement the PayPal payments (step 4 above).

I like the suggestion by other user sbraver above "Can we then set a RULE that if payments come in this way, the PayPal fee is automatically generated and recorded?"

This to me would e ideal. The reply by ClayJ to this comment did not make sense to me and did not seem to address the issue though.

Thank you for your help!

Thank you LilyC for your suggestions, but we have the Desktop version of QB Enterprise and it looks like this only applies to users of Online version. 

The articles are interesting nonetheless, thank you.

Hello, @SkyFlower.

Welcome back to the Community. Allow me to elaborate a little more about my earlier post. I was explaining bank rules for both QuickBooks Online and QuickBooks Desktop to sbraver to help clarify what can and cannot be done with that feature.

As for connecting PayPal to QuickBooks Desktop, you can integrate that platform via a 3rd party app. Because there are many different apps in the App store, my best recommendation in this situation is to check out the website to find a provider that best meets your needs in this regard. You can reach that site via this link. 

I hope you find what you're looking for. If you have any additional questions about the information I've provided, please feel free to reach out to me here in the Community.

Thank you for clarifying ClayJ 

Do any of these Aps work with desktop version - I tried the obvious PayPal one, but it did not seem to at first try.

Do you have any 3rd Party Ap suggestions? (low cost or free) as I have not heard of any of them - Thx!

Hey again, @SkyFlower.

Thank you for getting back to me. I'm unable to make any specific recommendations, as there are many apps in the store; however, I can confirm there are plenty of apps that do integrate with the desktop version. I recommend checking with PayPal directly, as they might be able to suggest one such solution that allows their program to link with ours. 

I hope this information helps. Feel free to reach out to me if you have any additional questions.

Did they answer what expense category?

Hello and welcome to the Community, @eve.

I'd like to make sure you're on the right path to getting those PayPal fees categorized. Every company is different, and the correct placement of that expense might change based on the nature of your company. While some users might choose a Miscellaneous Expense, a company that uses PayPal quite frequently may consider a dedicated PayPal Fees expense account.

I encourage you to reach out to an accounting professional for help choosing the right account for your business. The Find-A-ProAdvisor site at this link allows you to get in touch with QuickBooks experts in proximity to your ZIP code. Individuals with their profiles published here are certified, knowledgeable, and will certainly have the answers you're looking for.

Please know I'm also available here in the Community should you need anything else at all. Thanks for reaching out, here's to a productive and successful week.

Hi John,

I’ve literally tried asking this question to 3 diff customer representatives online and no one seemed to have understood my issue. 

I haven’t tried your method yet but I will on my next invoice I get paid with PayPal. My question is, what do you mean by accept green match? And where am I recording the deposit in? The PP bank account or the account in which my money has been manually transferred to (I.e. actual bank account linked to my QBO)? 

Thanks!

Demie 

Hello Demliew,

It's nice to have you in the Community.  I'm here to assist with recording your PayPal transactions. 

The instruction of accepting the green match is referring to matching the deposit in QuickBooks Online with the one downloaded from the bank, since the amounts are now the same.  I'm including a helpful link with additional information on this: Add and Match Downloaded Banking Transactions.  Additionally, the transaction would be recorded into the bank account that the money is deposited into.  The following link contains further insight on this process: Enter a Bank Service Fee While Using a Third-Party Merchant Service.

Please let me know if you have any questions about these steps or anything else.  I hope you have a pleasant rest of your week. 
 

Hello there, @Anonymous.

Thanks for joining us here in the Community. I can help you delete a journal entry in QuickBooks.

The steps to do this will differ depending on which QuickBooks version you're currently using.

For QuickBooks Desktop (QBDT), here's how:

1. Go to Company or Accountant menu at the top, then pick Make General Journal Entries on the drop-down.
2. Click the Previous arrow to open the previous journal entry.
3. Press Ctrl + letter D on your keyboard, then choose OK to delete.

For QuickBooks Online (QBO), here's how:

1. Go to the Gear icon at the upper right, then pick Chart of Accounts under Your Company column.
2. Locate the appropriate account for the transaction, then choose View Register (or Account History) from the Action column.
3. Click the journal entry, then pick Delete.
4. Select Yes to confirm that you want to delete the transaction.

For more information, you may check out this article that tackles reversing or deleting a journal entry in QBO.

That's it! Please let me know how it goes or if I can be of additional assistance by leaving a comment below. I'm only a post away if should you have any follow-up concerns. Take care and have a good one.

When I follow these steps I am getting a double entry.

I guess I am not understanding the steps.

I create an Invoice

The customer pays through PayPal and I deposit the funds in the Undeposited Funds account.

Money is transferred to the business account.

I create a bank deposit less the PayPal fee and associate this with the correct account for the P&L to categorize it. 

This is where I am seeing entries into both the AR and categorized account, thus creating the double entry of income.

Also, the transfer of funds from PayPal to the bank account are also creating a double income issue.

I have tried to learn through the multiple responses and I am just turning in circles trying to get this completed.

Any help would be great as I have tried to locate a step-by-step and have come up empty.

Thanks so much.

I've got you covered, Breezy17.

I'm here to provide some additional insight on your question regarding the double entry.

I appreciate the details that you provided. However, I just want to clarify if you used the funds you deposited in the Undeposited Funds account when you transferred the money to the business account?

If you didn't, then that would be the most likely reason why your income is doubling. To fix this, we'll need to delete this entry and recreate it using the right accounts. The steps below will walk you through the steps on how to do it:

To delete the deposit

1. From the List menu, select Chart of Accounts.
2. Double-click the account where you created the deposit.
3. Find the entry and double-click it.
4. Once it's open, click the Edit menu, then select Delete Deposit. You can also press Ctrl + D.
5. Hit OK when the Delete Transaction window shows up.

To transfer the money to the business account with the PayPal fee

1. From the Banking menu, select Make Deposits.
2. In the Received From field, enter the name of the customer.
3. When the Payments to Deposit window shows up, select the correct transaction in the Select Payments to Deposit section.
4. Click OK.
5. On another line, fill in the appropriate details in the following fields:
   - From Account: Enter the expense account where you record the fees.
   - Amount: Make sure to enter the fee as a negative amount.
6. Click Save & Close.

For more information about this process, I recommend following this article: Understand how the Undeposited Funds account works

In addition, I also recommend getting in touch with an accounting professional for a personalized opinion. Every business is unique and they can make suggestions for handling these entries. Our Intuit Find-A-ProAdvisor site allows you to find certified professionals in your local area that are sure to have the answers you're looking for.

Please let me know if this helps you correct the double entry, it's my top priority that this gets resolved. Thanks for reaching out, I look forward to hearing from you.

Thanks for the insight, here is where I am:

Hi Breezy17,

AldrinS (QuickBooks Team) posted a new reply in Banking on 01-11-2019 05:28 PM:

Re: PayPal Fees

I've got you covered, Breezy17.

I'm here to provide some additional insight on your question regarding the double entry.

I appreciate the details that you provided. However, I just want to clarify if you used the funds you deposited in the Undeposited Funds account when you transferred the money to the business account?

• The accounts were set up prior to me coming on board and that is part of the issues. They transferred from a different accounting program half through the year and DID NOT transfer/reenter the invoices. As I have been working through the process I am finding missing invoices (deposits and not invoice) or invoices but no matching funds, even though it has been marked as paid.  They set Paypal up as an account which is where the information is downloaded to. If I understand what you are saying, for each deposit in Paypal, it needs to be accepted as a deposit to PayPal (the same as I am accepting the Square payments to the chequing account, as Square shows me which transactions are involved with each of the ‘transfers’. As I have been working diligently (struggling really) through this mess, I think I might be getting a slight, very slight handle on things.

If you didn't, then that would be the most likely reason why your income is doubling. To fix this, we'll need to delete this entry and recreate it using the right accounts. The steps below will walk you through the steps on how to do it:

To delete the deposit

From the List menu, select Chart of Accounts. Double-click the account where you created the deposit. Find the entry and double-click it. Once it's open, click the Edit menu, then select Delete Deposit. You can also press Ctrl + D. Hit OK when the Delete Transaction window shows up.

To transfer the money to the business account with the PayPal fee

From the Banking menu, select Make Deposits. In the Received From field, enter the name of the customer. When the Payments to Deposit window shows up, select the correct transaction in the Select Payments to Deposit section. Click OK. On another line, fill in the appropriate details in the following fields:
- From Account: Enter the expense account where you record the fees.
- Amount: Make sure to enter the fee as a negative amount. Click Save & Close.

• Sometimes when I try and assign the Undeposited Funds to the account I get an error ‘Select a bank account for this deposit’ this is one of the confusing things I encounter. I then choose Uncategorized Income and it accepts this. How can this error be fixed?

For more information about this process, I recommend following this article: Understand how the Undeposited Funds account works

• I tried this many times, and needless to say, I was not very successful at getting the answers I need. I understand the purpose for this account and now that I have been working through the process with the Square account I am seeing how this might bring my P&L to show the proper information, but other than that, the article did not help me.

In addition, I also recommend getting in touch with an accounting professional for a personalized opinion. Every business is unique and they can make suggestions for handling these entries. Our Intuit Find-A-ProAdvisor site allows you to find certified professionals in your local area that are sure to have the answers you're looking for.

• As I work through and learn more about this program I will continue to read the articles and TRY and follow the examples (though they are not very informational). I appreciate you taking the time to help me with these issues. I am a learn as I go kind of person and it has been many years since I last worked in QB and it was the desktop version. Needless to say, this has been a bit of a struggle as I am not able to ‘go back’ like before.

Please let me know if this helps you correct the double entry, it's my top priority that this gets resolved. Thanks for reaching out, I look forward to hearing from you.

Hello, Breezy17.

Based on the detailed information you provided, it seems like you're using QuickBooks Online. Then, you've connected PayPal using the bank feeds.

The double entries can be caused by adding a deposit from PayPal, then recording another deposit in QuickBooks Online.

Instead of adding the deposits, you'll have to match it to the existing transaction. Here's how:

1. Click Banking, then choose Banking.
2. Choose the PayPal account, then look for a deposit.
3. Click to open the transaction.
4. Choose Find Match.
5. Under Show, click the drop-down arrow, then choose Deposits.
6. Choose the transaction to match, then click Save. 

 The Undeposited Funds is the default account that holds the payments against invoices or when you create a sales receipt. You create a deposit from the Undeposited Funds, not create a deposit to it. That's the reason why you get the "Select a bank account for this deposit" error. Yes, it will accept the Uncategorized Income account and the payment will be categorized under it. Though, you can always choose a specific income account for your deposits.

Please let me know if you have further questions, tag me and I'll get back to you.