Bank transfer was cancelled - how do I correct the customers record to show a balance due?

Hello, @Scagkc.

Correcting a cancelled bank transfer can be complicated, so it's advisable to seek guidance from an accountant. However, if your bank is connected to QuickBooks Online (QBO), you can follow these steps to unapply the bounced check payment from the original invoice:

1. Go to Sales, then select Customers.
2. Find and select the customer whose payment bounced.
3. Find the payment for the bounced check and select Edit.
4. Select the payment made link.
5. Uncheck the box for the invoice that the payment had been applied to.
6. Select the new expense you created in Step 1.
7. Select Save and close.
8. A message displays saying that the transaction is linked to others. Select Yes.

To inform your customers about what they owe and why, you can create a statement: 

1. Go to Sales, then select Customers.
2. On the Customers tab, select the name of the customer who issued the bounced check to open the Transaction List.
3. In the New transaction dropdown, select Statement.
4. In the Statement Type dropdown, select Balance Forward.
5. Set the Statement Date, Start Date, and End Date.
6. Select Print or Preview to make a copy of the statement, or select Save and send to email the customer with the statement attached.

If you want to know how bank fees or any other fees are being charged, you can refer to Step 3 of this article: Record a returned payment or bounced check in QuickBooks Online

For future reference, here's a guide on recording and receiving your customer's payment: Record invoice payments in QuickBooks Online

If you have further questions about cancelled bank transfers, you can comment below, and we'll respond to you as soon as possible.

Step 6 refers to 'the new expense you created in step 1' but there is no newly created expense in step 1. Please clarify what this is and the steps to do this.

I can provide the steps in handling bounced check payments, @AB118. 

If your bank is connected to QuickBooks Online, you can unapply the bounced check payment from the original invoice. 

The first step we'll need to do is recategorize the bounced payment. It will reopen the invoice and create an expense to account for the deducted money, ensuring that your records are accurate. 

To do so:

1. Hover over to the Transactions on the left panel, then select Bank Transactions. 
2. Look for the bounced check or returned payment in the bank feed. Select it to expand the transaction details.
3. Choose the customer whose payment bounced in the Vendor/Customer dropdown. 
4. In the Account dropdown, select Accounts Receivable.
5. Once done, select Add.

This process offsets the unpaid invoice. However, if you don't have a bank connected to QuickBooks or the returned payment has not shown up yet, you can make an expense for this transaction.

Second, we'll need to unnapply the bounced check payment from the original invoice: 

1. Click the Sales menu, then select Customers. 
2. Choose the customer whose payment bounced.
3. Look for payment for the bounced check and click Edit.
4. Click the payment made link, then uncheck the box for the invoice that the payment had been applied to. 
5. Select the expense we've created before.
6. Hit Save and close.
7. A message will appear on the screen saying the transaction is linked to others. Hit Yes.

For the next step, refer to Steps 3 and 4 in this article: Record a returned payment or bounced check in QuickBooks Online. 

I'd still recommend consulting your accountant, as the steps are tricky and complicated. This way, we can ensure the accuracy of your books. You can check out our Find an Accountant tool if you don't have one. 

Furthermore, I'll add some articles that can help you in managing your customers and transactions in QuickBooks Online:

• Create and send customer statements. 
• Record a customer refund. 
• Categorize online bank transactions. 

I'm consistently here to assist you anytime you need help with your bank transactions. You can enter your response by clicking the reply button below. 

What if your bank account is not connected to QB online? How do you record the bank transfer that was canceled?

I have the process for recording the canceled bank transfer, David. I'll guide you through it.

We'll have to manually create a check and post it to Accounts Receivable since your bank account isn't connected to QBO. Let me show you how:

1. Click + New, then choose Check under VENDORS..
   
   
2. Fill in the necessary details.
3. Hit Save and close.
4.  
5. 
   

Then, unlink the payment to the associated invoice. Follow the steps below:

1. Go to the Sales menu (Take me there).
2. Select Invoices.
3. Find and click the invoice in question
4. A window will appear. Tap on the View payment link.
   
   
5. Untick the invoice to clear the payment.
6. Enter the invoice amount in the Amount received field.
   
   
7. Hit Save and close, then tap Save as credit.
8. To confirm, select Yes.

Once done, let's utilize the Receive payment option to link the unapplied payment and check. Here's how:

1. Click + New, then choose Receive payment under CUSTOMERS.
2. Select the customer's name.
3. Tick the Check and the Unapplied payment boxes.
4. Hit Save and close.
   
   

Moreover, you may also want to personalize and add specific details to your sales forms in the future: Customize invoices, estimates, and sales receipts in QuickBooks Online.

I'm always around and ready to help you if you need further assistance or have questions about handling sales-related activities or payments in QuickBooks. Leave a comment below to notify me. Have a good one.

How do I correct/remove the returned payment if it was a sales receipt not an invoice? (The payment has to be made at time of sale) Payment was made by check and was deposited with numerous other checks.

Hello bosettilawncare,

Thank you for reaching out to the Quickbooks Community! Just to clarify is it a situation where the check payment was received or the funds were never received? In the first situation, you might need to issue a Refund Receipt to send the funds back to the customer and in the latter you could void the check payment. However, I highly recommend connecting with your accountant to see what is the best process for your company. If you don't have an accountant, feel free to use our ProAdvisor Service where you can connect with experts within your area. Use the link below if necessary.

• Find an Accountant

If you have any other questions, I'm just a post away. Have a wonderful day!

When I select the expense created from the canceled bank transfer this message appears:

This transaction has been deposited. If you want to change or delete it, you must edit the deposit it appears on and remove it first.

How do I override this or correct this?