How to Record Credit Card Chargeback w/ Fee That Customer Didn't Pay
We received a credit card chargeback from a customer who later redeposited. However, we paid the bank fee of $25. How do I record that (Journal Entry, new Invoice, etc) when the fee is included in the chargeback amount and doesn't match the original customer invoice or deposit amount?
I can give you two options to record a chargeback in QuickBooks. You can process the transaction as a refund or record it as a business expense. Either way, a chargeback transaction will show up on your bank statement as a separate item.
Since you're paying it as an expense, I'd suggest using the check.
Here's how you can record it as a business expense:
Click the +New icon and select Check.
Click the Bank Account drop-down list and choose the customer name that was used for the original credit card payment transaction.
Delete the check number (you can enter a note to indicate that this check is a chargeback.
Enter the total amount of the charge back item.
Clear the Print later checkbox.
For the Account, choose the account that you charge for the transaction.
Click Save and close.
To record it as a refund, just follow these steps:
Select the +New icon and click Refund receipt.
Select the customer you want to refund.
In the table, enter information about the original sale for which you want to issue a refund.
Enter the amount you want to refund.
From the Payment method drop-down list, select the credit card used for the original payment.
In the Credit Card Transaction Status window, click Print if desired.
Besides, you can run the Customer Balance Summary report to see what payments and invoices make up each customer's outstanding balance. Just go to the Reports menu and search for the Customer Balance Summary report.
Please let me know if you have more questions. I'll be around to help. Stay safe!