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Recording a wire fee

We have several customers who pay via wire transfer.  Their payment will come through, minus the wire fee, so if their invoice was $400, it would post as $380.  I had created a credit memo to offset the wire charge, but it's not debiting the Bank Fees Expense account.  How should I record the $20 wire fee if I've already recorded the payment (less the wire fee)?  Is there a journal entry I can make to have it charge the expense account?

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Best answer 10-15-2018

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ProAdvisor

On the receive payments screen, receive the invoice in fu...

On the receive payments screen, receive the invoice in full.

On the make a deposit screen, after you've checked off the payments for deposit, on the next blank line enter in the account column bank charges & in the amount column enter the fee as a negative number. This will net the deposit.

17 Comments
ProAdvisor

On the receive payments screen, receive the invoice in fu...

On the receive payments screen, receive the invoice in full.

On the make a deposit screen, after you've checked off the payments for deposit, on the next blank line enter in the account column bank charges & in the amount column enter the fee as a negative number. This will net the deposit.

Not applicable

So what do I do with ALL the $- bank fee lines for my cus...

So what do I do with ALL the $- bank fee lines for my customers?
Established Community Backer ***

Your Customer didn't incur that cost; you did. You don't...

Your Customer didn't incur that cost; you did. You don't want this to show it Reduces the customer balance in lieu of their Full Payment. The customer paid in full and you incurred the cost, by accepting that as one of your payment methods.
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So what do I need to make the fees stop?

So what do I need to make the fees stop?
Established Community Backer ***

Make the fees Stop? Find a payment processing merchant ac...

Make the fees Stop? Find a payment processing merchant account provider that doesn't charge as much. Is that what you mean? I get free ACH through my bank.
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It's customers bank charging....it's not ours.

It's customers bank charging....it's not ours.
Not applicable

How does this work when you try to match it with the bank...

How does this work when you try to match it with the bank transaction? I matched a wire payment with an invoice and it doesn't seem to let me change the amount received because it's linked to my bank fee
Established Community Backer ***

"How does this work when you try to match it with the ban...

"How does this work when you try to match it with the bank transaction? I matched a wire payment with an invoice and it doesn't seem to let me change the amount received because it's linked to my bank fee"

Make the entry for the Payment yourself, first. Process the receive payment for the full amount the customer paid. Not for the Net to Banking, because the customer didn't incur the fee. You incurred the fee.

The customer owes $200.

You process a Payment for $200.

You put this to Deposit, and on the next line, using negative, post the bank fee expense. Now you have a Total Net reduced deposit.

Now electronic banking can match that same total.


Established Community Backer ***

"It's customers bank charging....it's not ours." You need...

"It's customers bank charging....it's not ours."

You need to decide if you want to accept payment like this or not. Then, you need to decide if you want to charge the customer a Processing Fee if they pay by wire. Some States allow you to charge the customer the fee for payment you process by credit card and some don't allow it. You consider your Rates, as well. Banking fees are part of overhead; if you are bleeding small amounts due to banking fees, you address that issue any number of ways that will resolve it for your operational needs.

Example: I got paid for a project, payment from Lichtenstein. The amounts were large, and the wire fee was a % and was large enough that I did not intend to Absorb it. But of course, I wanted to Keep Working with these people for their large US project. So, we discussed them moving funds to their own US bank account, first.

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Re: On the receive payments screen, receive the invoice in fu...

Do you mean when you do your monthly bank reconcilliation?  I have never used the Make a deposit screen.  

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Re: Recording a wire fee

To create a deposit:

  1. Go to the Plus icon, then choose Bank Deposit
  2. In the Receive From column, select the customer's name.
  3. Pick Accounts Receivable in the Account column and enter the amount of the invoice. 
  4. From the second line, choose the customer's name in the Received From column.
  5. Enter Wire Fee expense in the Account column, then enter the amount in negative
  6. Click Save and Close (see screenshot 1).

To match the deposit to the invoice:

  1. From the Plus icon, choose Receive Payment.
  2. In the Choose a customer field, pick the name of the customer. 
  3. Put check marks in the Invoice and the Deposit.
  4. Click Save and Close (see screenshot 2). 

Check out these articles for more details:

Not applicable

Re: On the receive payments screen, receive the invoice in fu...

To create a deposit:

  1. Go to the Plus icon, then choose Bank Deposit
  2. In the Receive From column, select the customer's name.
  3. Pick Accounts Receivable in the Account column and enter the amount of the invoice. 
  4. From the second line, choose the customer's name in the Received From column.
  5. Enter Wire Fee expense in the Account column, then enter the amount in negative
  6. Click Save and Close (see screenshot 1).

To match the deposit to the invoice:

  1. From the Plus icon, choose Receive Payment.
  2. In the Choose a customer field, pick the name of the customer. 
  3. Put check marks in the Invoice and the Deposit.
  4. Click Save and Close (see screenshot 2). 

Check out these articles for more details:

Established Community Backer ***

Re: On the receive payments screen, receive the invoice in fu...

@Mike Tyler

 

You receive the payment in full; it's the Banking that gets the reduction. You don't jump to Deposit First, for AR; you use Receive Payment to apply to the open invoice(s). Make sure your payment flows to Undeposited Funds.

 

When you create the deposit, you select the UF to add to this deposit, and then the Negative on the manual entry doesn't need a name; it is not the Customer's fault you incur a banking fee. It is generically reducing the Banking, not the customer's activity, not the payment amount and not part of Sales.

 

Please see my attachment.

Not applicable

Re: On the receive payments screen, receive the invoice in fu...

I followed your steps and they worked great. Customer balance is showing accurately.

 

However, when I run the Open Invoices report, it shows up, even though there is no balance.  Do you have any advice?

 

Thanks

 

 

QuickBooks Team

Re: On the receive payments screen, receive the invoice in fu...

Thanks for joining this thread, officegal-BBLLC.

 

Allow me to step in and help provide some insights about the open invoices report in QuickBooks Online (QBO). 

 

When processing a bank deposit, possible that the payment doesn't link to an invoice that's why it still shows open on the report. 

 

To mark the invoice as closed, here's how: 

  1. In the left tab menu, click Sales.
  2. Go to Customers.
  3. Double-click the customer's name that has an open invoice.
  4. Click New Transaction drop-down arrow.
  5. Choose Payments.
  6. Select the open invoice that shows on the Outstanding Transactions as well as the Unapplied Payment that shows on the Credit.  
  7. Click Save and Close

By processing these steps, this will link the invoice and payment that you record on the bank deposit.

 

For additional reference, you can check this article on how to link a deposit to an invoice

 

If you need further assistance with the steps, I recommend contacting our QuickBooks Online Support Team. They have the tools to pull up your account and do a screen-share.

 

Here's how you can contact our customer support:

  1. Sign in to your QuickBooks Online company.
  2. Select Help (question mark icon) at the top right.
  3. Select Contact us to connect with a live support agent.

This will get you on the right track. Don't hesitate to leave a comment below if you have additional questions about the invoice transaction. I'll be around to help you out.

Not applicable

Re: On the receive payments screen, receive the invoice in fu...

I have the same issue but when I followed your instruction my deposit was recorded twice .

I must be doing something wrong but I am not sure what?

QuickBooks Team

Re: On the receive payments screen, receive the invoice in fu...

Hello, @sholeh,

 

It could be that you created a bank deposit while you already have an existing one. Let’s run a report to confirm if there are duplicate deposits.

 

Here’s how:

  1. Go to Reports.
  2. On the search bar, type Deposit details.
  3. Click Customize.
  4. Under Customize report, select General and fill out the dates.
  5. Select Filter, and put a checkmark on the necessary information needed.
  6. Then click Run report.
  7. If you see two deposits for the same customer and amount, click the amount to open the transaction.
  8. Click More at the bottom and hit Delete.

If there are no duplicates, I’d like to confirm which set of instructions in the thread have you performed to help me further check on what happened and provide you a solution from there. I’d appreciate any details you can add.

 

If you have other questions, please feel free to leave a comment below. I’m always here to help. Have a great day!

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