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.
