Record bounced check feature not working

I need to know why my record bounced check feature is not working.  We use Quickbooks merchant services (e-checks only) and need to record the bounced check.  It would be nice if this was handled through the merchant services interface.

Thanks for posting to the Community, @hartholdingsinc.

Please make sure that you change the method before you recorded it as a bounced check.

Let me show you how to change it to check for you to record it as a bounced check:

1. Go to the Customers menu and then select Customer Center.
2. Select Transactions.
3. Choose Received Payments.
4. Double-click the payment you want to record as a bounced check.
   
    
5. On the received payments window, change the payment method to Check. (Please take note that the check must not be waiting to be cleared in the Undeposited Funds account, as it would have to have cleared the bank to bounce)
6. Click Save & Close.
    
7. Double-click the payment again to record it as a bounced check.
8. Select Record Bounced Check and then enter the details.
9. Click Next and then select Finish.
10. Hit Save & Close.

There it'll be recorded as a bounced check.

You can refer to this article for more options on how to record bounced checks: Handle Non-Sufficient Funds (NSF) or bounced check from customers.

If you wanted to know how to combine multiple transactions into a single record, you can check this article: Record and make Bank Deposits in QuickBooks Desktop.

Please let me know if you have additional questions. I'm always here to help you. Have a good one!

I don't have the option to change the payment type.  The only thing that shows is "e-check" and it is greyed out.

Hi hartholdingsinc,

Since the payment method is grayed out, you'll want to manually record the bounced check in QuickBooks. Beforehand, let's create an item and income account for tracking bounced checks and their associated charges.

To create an income account:

1. Go to Lists and select Chart of Accounts.
2. Click on the Account drop-down at the bottom and choose New to create a new account.
3. Select Income Account and click on Continue.
4. Type in Bounced Checks Income as the account name.
5. Click on Save & Close.

Then, create an item called "Bad Check Charge". Just make sure to select the Other Charge type.

Once you're done, record a journal entry to reverse the original payment. You can follow the steps in the Option 2 section in this article: Handle Non-Sufficient Funds (NSF) or bounced check from customers.

Just in case a check has been returned by your vendor due to non-sufficient funds, check this article on how to manage a bounced check you wrote.

Please let us know if you have any other concerns. We're always here to help.

Just to confirm a similar situation I have - here is a screen shot of a processed Merchant Service deposit, which Intuit Payments later notified me was returned.   Note that the "Record Bounced Check" button is grayed out, AND the PMT. METHOD is grayed out, so I can't change the PMT. METHOD to get the "Record Bounced Check" ungrayed out.

It looks like in this case I have to do the bounced check via the old manual process.  Is there any other way to get the items ungrayed?  Is this a "bug" needing to be reported?

Hello there, @TRRb!

The Record Bounced Check and the Payment Method function is grayed out when you received an e-check or an e-check returned payment. You're on the right track in manually recording the bounced check by following the steps shared by my colleague, @JaneD.

Lastly, here's a few articles you can read to help manage your customers and sales transactions: Income and Expenses for QuickBooks Desktop.

If there's anything else that I can help you with, let me know in the comments. I'll be here to lend a hand.

Is this a "bug"?  If not, can it be a feature request to enable "Record Bounced Check" for such Merchant Services Deposits?

I appreciate the quick response, @TRRb.

As mentioned by my colleague, it seems that this option is grayed out once the system recognized the returned payment.

Our Product Team is constantly working to improve the product and appreciates the help of users in bringing things like this to their attention. I'll take note of this and pass it along.

Should you need anything else, please let me know. I'm here to help however I can.

Thank you!

Hey TRRb. I'm glad my issue was resolved. Make sure to come back if you need anything else someone is always ready to help in the QuickBooks community. Have a great rest of your day. 

I see this issue came up over a year ago and it still hasn't been fixed. Any plans of doing so?

Hi there, @HankR.

The payment method is greyed out. However, you'll have an option to manually record bounced checks in QuickBooks. Before that, create an item and income account for tracking bounced checks and their associated charges.

Here's how:

1. Click on the Lists menu. Select Chart of Accounts.
2. Click on the Account drop-down at the bottom and choose New to create a new account.
3. Choose Income Account and hit Continue.
4. Type in Bounced Checks Income.
5. Hit Save and close.

Then, create an item called "Bad Check Charge". Just make sure to select the Other Charge type.

Once done, you can follow the steps in Option 2: Handle Non-Sufficient Funds (NSF) or bounced check from customers. This way, you can create a journal entry to reverse the original payment. 

You can also review this article in case of returned checks: Manage a bounced check you wrote

Let me know if you have further questions. Have a good one!

This was life saving for me

Hello there, Prav_U.

I'm glad my colleague was able to help you out with your concern.

Please don't hesitate to post any details if you need further assistance. The Community team is always ready to assist you. Take care and have a wonderful day.

QuickBooks Pro Plus 2022 – Windows

When I enter a payment in the Customer Payment area, the payment defaults to E-Check and there’s no way to change it. I think it also greys out the Record Bounced Check feature, which is what I really want to work.

I’ve Verified and Rebuilt the data and that didn’t change the problems above.

I appreciate the steps you've tried with Bounced Check issue concern, PQH.

You'll have the option to record the bounced check in QuickBooks manually. Ensure to create an item and income account for tracking the bounce checks and charges associated with them. Here are the steps in creating an income account:

1. From the Lists menu, select Chart of Accounts.
2. Click on the Account drop-down at the bottom and choose New to create a new account.
3. Select Income Account and click on Continue.
4. Type in Bounced Checks Income as the account name.
5. Click on Save & Close.

Now, create an item called "Bad Check Charge". Just make sure to select the Other Charge type.

For additional details, check it out here. 

As always, you can post your questions anytime here. I'll be around to assist.

After going through all the suggestions, rebuild, verify data, etc. Nothing was working for me to activate the "Bounced Check" feature. We use merchant services and our payments are all e-checks. 

Here's how I dealt with it. 

1. (After notification that the payment was NSF from the customer or bank) Process a new payment for the existing invoice. 

2. Because this invoice will be "paid twice", QB will ask you what you want to do with the payment credit in the lower left section of the Customer Payment screen;

OVERPAYMENT 

When finished:

-Leave the credit to be used later 

-Refund the amount to the customer

-->choose Refund the amount to the customer

Then choose to create a check but don't print it. 

Essentially what this is doing is charging back the amount that bounced (virtually). Works like a charm, no messy credits and balances out of whack. 

Thank you! You just saved my hours of wasted time.  I too could not get the NSF feature to work, and yes it was because I originally did not record it as a check. In another post the QB staff erroneously had people doing data fixes that have nothing to do with this problem, and are actually damaging to your files.  Please learn from this post QB staff!

I have always been able to use this feature. Now Record bounced check is grayed out. I used "record bounced check" less than a month ago. Yes, "check" is selected. I know how to do this and have never had this happen until today. Has this feature changed?

This is not accurate. We receive ACH transactions all the time. Just last month we had an ACH payment returned. I was able to go into the payment and "record bounced check" as I always have. Now it's grayed out, "check" is selected yet the function no longer works. Has something changed recently?

Thanks for joining the discussion, @hfrantz. I recognize the importance of smooth functionality in QuickBooks, especially when managing bounced checks. It's concerning that the Record Bounced Check option is unavailable, even though you've used it successfully before.

This feature is only accessible in single-user mode and applies solely to check payments made through the Customer Payment window. If you have a returned ACH item, change the payment type to Check before proceeding.
 
Since the payment method is grayed out, you'll need to record the bounced check manually. Let me guide you through the process.

1. Make an item and income account to track bounced checks and their associated charges.
   
   • Create an income account:
     • Type: Income Account
     • Account Name: Bounced Checks Income
       
   • Create a Bad Check Charge item:
     • Type: Other Charge
     • Amount or %: 0.00
     • Tax Code: Non-taxable
     • Account: Select the Bounced Checks Income (created in step a).
       
2. Generate a journal entry to reverse the original payment. I recommend consulting your accountant during this step. If you don’t have one, you can find an expert here.
   • Navigate to the Company menu and choose Make General Journal Entries.
   • Under the General Entries window, debit your account receivables for the same amount of the NSF check.
   • Add a note in the Memo column describing the transaction.
   • Select the customer or job associated with the NSF check in the Name column.
   • Credit the checking or bank account that received the original deposit.
   • Click Save & Close.
     
3. Switch the payment for the invoice to the reversing journal entry. This will deduct the bounced check amount from your account, and the invoice will be marked unpaid.
   • Head to the Reports menu, select Customers & Receivables, and then Customer Balance Detail.
   • Double-click the original payment line for the NSF transaction.
   • In the Receive Payments window, transfer the checkmark from the invoice to the reversing journal entry.
   • Hit Save & Close.
     
4. (Optional) Resend the open invoice.
   • Go to the invoice where the bounced check originated.
   • Add the item Bad Check Charge (created in step 1).
   • Choose the Email icon on the Main ribbon tab, then click Send.

For more detailed information, visit this article: Handle Non-Sufficient Funds (NSF) or bounced checks from customers.

In case you need to handle a check returned by your vendor due to NSF in the future, check out this article for guidance: Manage a bounced check you wrote.

If you have any more questions or need further assistance with bounced checks, feel free to ask. It's always a pleasure to be of help. Take care, hfrantz.

The "check payments WAS made through the Customer Payment window.  The payment type IS marked as  Check." I know HOW to record a bounced check using this feature. It is NOT working as it has as recently as last month. I am trying to determine if this functionality was recently removed from QB? This was a simple way to record a bounced check (ach payment). Now it appears that the only way to accomplish the same goal is through a lengthy series of manual steps. Is this correct?