Handle a cancelled bank transfer

Hello there, Tgeorge. Let me provide the steps for handling your customer's canceled bank transfer in QuickBooks Online (QBO).
 

Before doing so, please know that these steps are complex and affect the record of your books in QBO. Therefore, I advise reaching out to your accountant for in-depth guidance. If you don't have one, browse through this website: Find a QuickBooks ProAdvisor.
 

Furthermore, if your bank is connected to QBO, we can record your customer's canceled payment as an expense. We will begin by recategorizing the bounced payment to mark the canceled transaction as unapplied, allowing us to reopen the original invoice effectively.

Here's how:
 

1. Log into your QBO account.
2. Go to Transactions, then choose Bank Transactions.
3. Look for the bounced check or returned payment in the bank feed. Click on it to expand the transaction details.
4. In the Vendor/Customer ▼ dropdown, choose the customer whose payment bounced.
5. Select Accounts Receivable in the Account ▼ dropdown.
6. Once done, select Add.

Doing this offsets the unpaid invoice. In cases where your bank account isn't linked in QBO or the cancellation hasn't been reflected as a payment, you can create an expense entry for this transaction, which will be matched once the payment details are available. Let's then unapplied the canceled payment from your original invoice. You can follow the steps below:

1. In your QBO account, go to Sales, then choose Customers.
2. Look and choose the customer with the canceled bank transfer.
3. Find the payment for the canceled payment, then click on the pencil icon to Edit.
5. Uncheck the box for the invoice to which the payment was applied.
6. Choose the new expense created a while ago.
7. Once done, click Save and Close.
8. A prompt will appear stating that the transactions have been linked to each other, then choose Yes.
 

After that, let's create an invoice for the bank fees to be charged to your customer. I'll be providing you with the procedures below:

1. Click on + New.
2. Select Invoice under Customers.
3. Choose the customer with the canceled payment.
4. For the Invoice date, use the date the bank charged the fees.
5. In the Product/Service column, select the service Bank Fees Charged to Customer.
6. Type in the amount charged to your customer.
7. Once done, click Save and Close.

You can then send a statement to your customer to let them know that there's still an open invoice and that a second invoice covers the bank fees. Refer to Step 4 in this article for the instructions: Record a returned payment or bounced check in QuickBooks Online.

Once the original invoice and bank fees are settled, you can proceed to receive their payments.

Return to this thread if you have further questions on handling your customer's canceled payments, Tgeorge. I'll be here to assist you any time.

The link that is included in the alert when this happens is broken. It leads to a 'not found' error.

I appreciate you for letting us know about this broken link, Brendan. Let me direct you to our dedicated support team to help you with your concern so that this will also help other customers with the same issue.

We've streamlined the process of how you can contact our support team. That's the reason why you'll have to go to the Help menu to contact them. Also, our support team caters not only to specific products but to all QuickBooks products. To reach out to someone, follow the steps outlined below:

 

1. Sign in to your QuickBooks Online company.
2. Go to the Help (?) menu.
3. Select either tab to get started:

• Assistant: Get quick, personalized answers. Select a suggested option, or type a question or topic you need help with. If you decide you need further help, you can still Talk to a human.
• Search: Search the QuickBooks Online knowledge base directly, or select Contact Us and choose a way to connect with us:
  • Start a chat with a support expert.
  • Get a callback from the next available expert.

Furthermore, go through this information that shows the premium features available in the Advanced version: Premium Features Available in Advanced.

Let us know if you have any other concerns about QBO Advanced. Please don't hesitate to reach out. Our support team is here to ensure you make the most out of your accounting software. Have a great day.
 

All of this information is good, but I have a question, as this has recently happened to me also.  

When the customer issued the ACH payment, QBO recognized the payment as received and applied it to the invoice.  A couple of days later I received the notification of a cancelled bank transfer.  I looked into it and discovered the reason it happened.  The customer selected savings account as the type, but was trying to pay from a checking account.  My question is, do I leave that original payment applied to the invoice?

We reached out to the customer, who said they would re-issue the payment, so I had to unlink the payment to resend the invoice so that it could be paid.  I will end up with 2 payments and a payment cancellation.  Can I apply the first payment and the cancellation to each other?  If so, how do I do that?

Good morning, @JenR64. 

Thanks for chiming in on this thread. I'd be more than happy to help you out with your question.

The best route would be to delete or void the first payment listed to that first invoice so that you can start fresh. To ensure that this would be the best route for your business, I recommend consulting with your accountant to see which option would be better. 

Here's some details about the delete and void options for the first payment.

Feel free to come back if you have any questions or concerns. We're always here to help!