I appreciate you following the steps provided above by my colleague, @ECD519. I'm here to ensure you can get your check deposits reconciled in QuickBooks Online (QBO).

If you have already recorded a received payment and deposited it to UD, you can select payments to add to this deposit when creating a bank deposit.

Otherwise, you don’t need to create a bank deposit if you have recorded the invoice payment and deposited it directly to the bank. Hence, it will only create duplicates in your register and overstate your income.

Here’s how to record a vendor refund that you can apply to a bill:

1. Navigate to +New and select Bank deposit.
2. In the Account dropdown menu, choose the account where the refund comes from.
3. In the Add funds to this deposit action, fill in the fields with the necessary information.
4. Select Save and close.

Moreover, if you haven’t created an invoice payment yet and want to enter it as a bank deposit beforehand. You can create a bank deposit that affects customer’s AR. Then, upon receiving the payment, you can apply the deposit as credit to the invoice.

If neither of these works, please let me know. I’ll be here and we'll try to come up with other troubleshooting steps to resolve this issue.

I DID NOT AUTHORIZE FOR YOU TO TAKE $373.61 OUT OF MY ACCOUNT! I WANT YOU TO GET IT BACK IN MY ACCOUNT AT ONCE!!

Hi, hunter1952.

I see the duplicate post of your concern. My colleague already responded and shared some information on this issue.

Please check this link for your reference: https://quickbooks.intuit.com/learn-support/en-us/reports-and-accounting/re-fixing-vendor-credits-an....

The Community is always here to help you out. Don't hesitate to drop a reply below.

I'm using Desktop Pro 2020.  When I create a deposit for a vendor refund check (using Accounts Payable as the "From Account" field and the appropriate Vendor), no line or bill shows up on my Pay bills screen.  I have about a dozen vendors showing inaccurate balances because in 7 years I've never been able to accomplish linking these deposits with the corresponding credit memos.

Hi there, @Dblue42. 

I got you covered in managing your vendors' credit in QuickBooks Online.

Let's turn off the auto apply credit feature in your preferences to avoid offsetting the vendor credit amount. So, once you create a deposit, it will appear on the AP account and you can link it manually

1. Go to the Edit menu and select Preference.
2. Select the Bills menu.
3. Click the Company Preferences and ensure to uncheck the Automatically apply credits box.
4. Then click OK.

To learn more on how to create a credit memo or refund check in QuickBooks Desktop  check out this link for reference: Give your customer a credit or refund in QuickBooks Desktop for Windows.

I've added these articles for future reference: 

• Record a vendor refund in QuickBooks Desktop.
• Customize reports in QuickBooks Desktop.
• Accounts Payable workflows in QuickBooks Desktop.

Additionally, I've also included this helpful reference for a compilation of articles to help organize your customer transactions: Learn the different ways you can track customer transactions in QuickBooks Desktop.

Keep me posted if there's anything else you need about this concern. I'll be around to help you out. Have a good one!

I am having the same issue as user christophers stated. 
I am using Quickbooks online. I have a Vendor Bill that a payment was made to via credit card. We received a partial refund back on the credit card. I have tried all steps mentioned in other replies, but no matter what I do the refund on the credit credit will not show up as a credit to the Vendor account. It always shows as an additional bill. 
How do I apply money received back on a credit card to a vendor account and ultimately to a particular bill?

Example:

Vendor Bill $500

Payment to Vendor by credit card $300

Refund received back to credit card $50

New balance on Vendor bill should show $250