Undepositd Funds

Hello, You need to enter the bank deposit into QB first. Make sure the amount matches exactly what's going to be deposited into the bank later that day.  Then, when your bank downloads the deposit, instead of clicking add, it should find the existing transaction and give you the ability to click MATCH.  If it doesn't, then click the downloaded deposit and click Find Mach and have it look for the bank deposit already in QuickBooks.

That way it links the download to the existing transaction already in your QB and doesn't do a double deposit.

Most times we physically take the deposit to the bank first. What happens in this case?

All of these tools exist so that you can do the Entries to match what happens in real life. You control each thing.

Batched Deposits: If you use UF for holding amounts, then make one large deposit for that date, the banking has this One Amount, so the Deposit you get as download needs to be matched to all the corresponding UF entries, to show these were part of that deposit. Or, you took that envelope to the teller yourself, so you would already have selected for one deposit "include these payments." That allows you to show the date the customer paid is not the same as the date of deposit, and/or that one deposit consists of lots of payments, giving one total in the deposit. Example: you picked up your office mail and process multiple customers' payments on this one date, making a physical deposit at the bank after 4pm, so that means Date of the Deposit is one date later then Date of Payment and they are all in that one Lump Sum deposit.

Individual entries: You make the payment or sales receipt flow to banking directly, or match the banking download to the open invoice, because in real life, that payment for that one sale is also posting to banking individually and for that same date. Example: You get paid electronically by specific customers, which means the date it shows in the bank is also their date of payment and they are not lumped together.

And Banking deposits are never income; you already have income from your sales activities. So, you created the duplicate income by assigning that banking is income. It's settlement of Sales, and you were already processing these as Sales transactions.

When you create a deposit, it should not be hitting your Cash Account; it is Checking. You control which account you are managing: Cash on Hand or Checking. And if you get payments during the day as a retail operation to a Cash Bank, then the actual deposit from Cash to Checking is also not Income. That would be a Transfer between your own two types of Money accounts. Moving your own money around isn't sales or income.

Hope that helps.

When reviewing the downloaded item, select Find Match.  That will bring up the screen where you can manually select all the payments sitting in Undeposited Funds that made up that deposit.  When you check them of and click OK it will enter the Bank Deposit transaction into QB and match that downloaded item to it.