Customer paid invoice with wrong credit card - I think my fix was incorrect

Welcome to Community, @Maverick2.

I have some information about recording a reverse payment. You're doing a great job in reversing the transaction from the Merchant Center. While the processed transactions (reverse payment) cannot be downloaded to QuickBooks, you'll have to enter the reversal manually in the program.

To do it, you'll have to go to the Customers menu at the top and then select Create Credit Memos/Refunds. Refer to this article for the steps: Give your customer a credit or refund in QuickBooks Desktop for Windows.

After creating a credit memo, the bank that issued your customer's credit card controls the timing. The credit could arrive within 2-4 business days or not until the end of your customer's billing cycle. That way, the unapplied amount will automatically posted to your QuickBooks account.

For more information about the process, check out this guide: Void or refund transactions in QuickBooks Payments.

Please know that you're always welcome to reply anytime if you have follow-up questions or concerns with customer payments. I'll be around to help. Take care and have a good one.

The answers you provided do not address my questions. Can you please re-read my original post or send my questions to a higher support level?

1. I know how to void or refund a payment in quickbooks merchant center (payments). I did that already (see my original post).

2. Creating a credit memo will return the items to inventory. I want to keep the original invoice.

This is frustrating. I don't want to simply retype everything I said in the original post. Please re-read my specific questions, and if you are unable to assist, pass it on to someone who can answer my specific questions.

Hello, Maverick2.

I'll help you fix the payment reflected in the undeposited funds.

You'll need to create Credit Memos/Refunds in QuickBooks once the payment has been reversed on merchant services. This is the proper method since the merchant service won't download transactions processed online.

In your situation, since the correct payment information has been applied to the original invoice, you don't need to issue a credit memo/refund to your customer. You can delete the unapplied payment to fix and clear the amount in the undeposited funds.

Here's how:

1. Go to the Customers menu.
2. Select Customer Center.
3. In the Customers & Jobs tab, locate the name of your customer.
4. Go to the Transactions tab and double-click the unapplied payment.
5. Under the Customer Payment screen, click Delete.
6. Hit Yes to confirm.

Doing this should clear your undeposited fund's account. You can exclude the reverse payment transactions if you use the bank feeds feature.

I've also added this article for future reference: Reconcile an account in QuickBooks Desktop. This contains detailed guidelines for ensuring that your QuickBooks balance matches the balance on your bank and credit card statements.

You're always welcome if you need further assistance with unapplied payments. I'll be here to help you.

@Giovann_G thanks for the info. In your reply you said do this in the future:

You'll need to create Credit Memos/Refunds in QuickBooks once the payment has been reversed on merchant services. This is the proper method since the merchant service won't download transactions processed online.

1. If I do it that way, the credit memo will return the items shown on the credit memo to inventory. No matter if you create the credit memo from the invoice or start with a clean one you still have to have products listed to enter credit value. This would work if the customer returned the items, but in my case the customer is keeping the items, not returning them.

You also said for my situation to delete the unapplied payment to fix and clear the amount in the undeposited funds. 

1. However, if I delete the payment that my merchant services downloaded to my company file, then my QB bank register will not match my bank statement. The deposit into my actual bank is already done. There will not be a corresponding payment entry in QB. Am I correct?

Thank you for getting back to us here in the Community, @Maverick2. 

Thanks for performing the suggested steps provided by my peers on this thread. It would be my pleasure to help you with any questions regarding the returned items. 

I can share some information to set up billable expenses in QuickBooks Desktop.

Depending on the setup or agreement you have with your customer, here's how you can process and record vendor refunds in QuickBooks Desktop.

• The vendor sends you a refund check for a paid bill. 

1. 1. Record a Deposit of the vendor check.
   2. Record a Bill Credit for the refunded amount.
   3. Link the Deposit to the Bill Credit.

• The vendor sends you a refund check for returned inventory items.

1. 1. Record a Deposit of the vendor check.
   2. Record a Bill Credit for the returned items.
   3. Link the Deposit to the Bill Credit.

• The vendor sends a refund check not related to an existing bill.

1. 1. Record a Deposit of the vendor check.
   2. Record a Bill Credit for the amount of the Vendor Check.
   3. Link the Deposit to the Bill Credit.

• A vendor sends a refund check on behalf of the original vendor.

1. 1. Create a deposit for the vendor who sent the refund check.
   2. Create a Bill for the Deposit amount and apply it to the Deposit.
   3. Create a Credit for the Original Vendor.
   4. Create a Bill for the Amount of the Credit affecting the Wash Account and link the Bill to the Credit.

• The vendor sends you the refund as a credit card credit.

You can check out this article for the steps: Give your customer's a credit or refund in QuickBooks Desktop for Windows. 

For your additional reference about credit memo and QuickBooks Desktop, you can check the following articles: 

• Record a credit memo or refund in QuickBooks Desktop
• Help articles for QuickBooks Desktop 

Thanks for being a part of our QuickBooks family. Please feel free to post again or leave a comment should you need anything else. I'll be happy to answer them. Have a great weekend. ​​

@LollyNino_C  You did not read anything that I wrote. I'm not even sure where to begin....

1. My issue has nothing to do with billable expenses.

2. My issue has nothing to do with vendors. It is a customer issue.

3. I already know how to give a customer a refund/credit. For the 10th time, if I create a credit it puts stuff back into inventory. The customer has not returned the item.

I don't know what I even bother? If a human is in fact replying and not a bot, you don't look at or review anything I've read. Have you read anything in this post?

Forget it. This is pointless.

Thanks for reaching out again, Maverick.

I'm joining this conversation to share additional insights with you. If you don't want to record a refund receipt to the customer as it affects the inventory, you can use a regular check to reduce the income balance. You need to use the income account on the check to relieve the refunded amount.

You don' need to unapply the payment on the invoice, in this case, because QuickBooks will not record the card details used on the transaction. Once the customer pay you back, just create a bank deposit to increase income again.

However, if you really want to make corrections to the applied payment that is sitting on the undeposited funds account, you can call our support to help you delete the entry. That way, you can apply a new payment towards the invoice.

You can contact our Payments Support directly to trace the funds for you. To get a live rep to help you, click the following link for our contact details: Contact Payments Support

I want to make sure all your QuickBooks concerns are taken care of, and I'm here if you need further help. Have a good one!