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kmpgc
Level 1

How to record credit card processing fee properly.

When I enter the fees into the deposit screen like shown above, it is creating credits for that customer. Why is this happening?

JamesDuanT
Moderator

How to record credit card processing fee properly.

Hello kmpgc,

 

Entering the fees through the deposit window doesn't create credits to the customer's account, unless you choose Accounts Receivable account. Here's what we need to do so you can have the same result on the video above:

  1. Set up your Preferences for Undeposited Funds.
  2. Pay the invoice.
  3. Create a deposit and include the fee.

Here's how you can review the Preferences:

  1. Click Edit at the top menu and select Preferences.
  2. In the Preferences window, select the Payments menu and go to the Company Preferences tab.
  3. Under RECEIVE PAYMENTS, mark the Use Undeposited Funds as a default deposit to account box.
  4. Click OK.

After paying the invoice, here's how to add the fee when creating a deposit:

  1. Click Banking at the top menu and select Make Deposits.
  2. In the Payments to Deposit window, choose the invoice payment and click OK.
  3. In the Make Deposits window, add the fee account under the FROM ACCOUNT column.
  4. Enter the fee amount as negative.
  5. Click Save & Close.

Let me know how this goes.

kmpgc
Level 1

How to record credit card processing fee properly.

I checked my preferences and it was already set to undeposited funds. From the customers & job tab on the left it shows they are PIF, but when I click on the customer invoice that's where it shows "balance due" and the fee, instead of $0.00. I attached a picture.

 

The girl before me had been adding fees under the discount tab but our P&L has a discrepancy so I am trying to go back, fix, and re-reconcile everything, using this way to enter fees. Also, not sure if this has anything to do with it but we are a cash basis company when it comes to reports.

 

 Untitled 3.png


Untitled 2.png

 

 

 

 

kmpgc
Level 1

How to record credit card processing fee properly.

I think I figured it out. I didn't uncheck and check after I changed the payment to the full amount so it was still showing up as the old amount paid (fee taken out).

 

THANK YOU!!

Charies_M
Moderator

How to record credit card processing fee properly.

Hello there, kmpgc.

 

Thanks for sharing us how you're able to figure it out. This will help a lot of customers who are also having the same issue.

 

Please know that the Community is always here anytime you need help about QuickBooks. You can post anytime if you have questions or want to share your best practices using the product.

jck667
Level 1

How to record credit card processing fee properly.

@ intuit guys, I have recently switched from the Mac 2016 version to Windows Pro 2018 and I have to say that the credit card fee process as described above is a big step BACKWARDS from the Mac workflow.  In the Mac version, you add the customer payments, then enter the net deposit amount, and QB proposes the net difference as an expense to the CC fees account.  Boom, hit "save".  Very simple and intuitive.  Just a suggestion for process flow improvement in the windows product.

 

(PS There are several features in Mac QB that would be nice to have in Windows QB that simplify and speed up work...)

Anonymous
Not applicable

How to record credit card processing fee properly.

Hello jck667,

 

Thanks for letting us know about your feedback. We'll take of it. For now, let me share some articles that'll help you run your business with QuickBooks for Windows:

You're always welcome to post some more questions. We'll be glad to help. 

Asherman
Level 2

How to record credit card processing fee properly.

Thank you!  

Tyler123
Level 1

How to record credit card processing fee properly.

I download my banking transactions online so card sales come through at the net amount.  From the "bank deposit" screen I adjust the bank deposit to increase the amount to the original sale price (before processing fees) then add the processing fee as a negative... so the amount still balances to the original bank deposit.  My concern is that the card purchases don't show on the list of expenses.  Is that a concern?

MaryLandT
Moderator

How to record credit card processing fee properly.

Thanks for joining this thread, @Tyler123.

 

Your transactions may have not yet cleared by your bank, which is why the expenses aren't showing on your bank feeds.

 

Once cleared from your bank, you can manually update your bank account to add the expenses.

 

Here's how:

  1. Go to the Banking menu.
  2. Select Bank Feeds, then Bank Feeds Center.
  3. Select the desired bank, then click the Refresh button. bankfeeds.PNG
  4. Click Transaction List to view the transactions.

Please refer to this article to learn more about downloading sales and expenses from your financial institution: Download Bank Feed transactions.

 

Should you need anything else, don't hesitate to reply to this post. I'm always around whenever you need help. 

Hoski
Level 1

How to record credit card processing fee properly.

Thank you, this is awesome.  I could not find the answer in QB and have been doing it he hard way for years.

pinkgeek1313
Level 1

How to record credit card processing fee properly.

I have followed the directions given in the video, but I am now seeing this issue:

 

1. When I reconcile the payments to my bank account, I am seeing the full amount paid by the customer in my deposits column, rather than what was deposited to my account (customer paid amount less the processing fee).  I do not have the fee listed in the withdrawals column to offset the incorrect deposit amount.

 

Keep in mind, my bank does not connect to Quickbooks.  So, I am responsible for adding everything manually.

Thanks for any help!

 

 

GraceC
QuickBooks Team

How to record credit card processing fee properly.

Thanks for joining this thread, @pinkgeek1313.

 

You can create an expense to record your processing fees that included the payment amount. Let me guide you how.

  1. Go to Banking.
  2. Click the Write Checks.
  3. Under Account click the drop-down menu. 
  4. Locate the Processing Fee, then enter the amount.
  5. Hit Save and Close.

Please see the screenshot below:

Capture QBDT987.PNGCapture QBDT9876.PNG

 

To learn more about your bank feeds and also for the bank transactions such as reconciling your bank account, you can visit our QuickBooks Desktop Help Article for the guidance.

 

Leave a comment if you need anything else. I’m more than happy to help. Have a good one!

Eve2019
Level 5

How to record credit card processing fee properly.

Hello,

 

What if my customer approved to charge his credit card for $500 and the credit card processing of 3%, which is now a total of $515.  The invoice still has a balance. How do I tell quick books that the $15 is a charge I  cc processing fees, will this be an income or expense account?

 

I have it as an income?

 

thanks

MariaSoledadG
QuickBooks Team

How to record credit card processing fee properly.

Yes, it's correct to use an income account for the processing fee, Eve2019.

 

You can create a service item and add the processing fee to your invoice.

 

Here's how: 

  1. Go to Sales, then choose Products and Services.
  2. Click on New then select Service.
  3. Enter the name of your service item. 
  4. Select the account you'd use to track the processing fee under the Income account drop-down.
  5. Click Save and Close.

You can also record credit card charges directly from the Merchant Service Center. Please check out this article if you want to know more about the process: Process payments in the Merchant Service Center.   

 

For future reference, you'll want to categorize bank transactions in QuickBooks.: Categorize And Match Online Bank Transactions In QuickBooks Online.

 

Let me know if you need help. I'll be here to assist you.

LoriTT
Level 1

How to record credit card processing fee properly.

i fully understand how this works however my question is 

 

when I do it this way and enter it the cc fee shows as type: Deposit and do not list the customer name

if i just match the invoice to the deposit from the online transaction screen it shows as type: Expense and shows the customers name

 

does it matter? other than just not liking how the report looks when i run a reprot for credit card fees??

MaryLandT
Moderator

How to record credit card processing fee properly.

Thank you for taking the time to explain that to us, LoriTT

 

I can see that the process of matching an invoice to the deposit with a fee is confusing to you. I want to make sure we record transactions in QuickBooks and ensure the report shows the correct amounts and categories.

 

To be clear, can you send a screenshot of how you enter the CC fee that shows a deposit with no customer name? 

 

Can you also provide the steps before matching the invoice to the deposit? Or a screenshot maybe of the invoice you match to the deposit that shows an Expense and the customer name.

  

I'll keep this post while waiting for your response. Thank you and have a great day ahead!

LoriTT
Level 1

How to record credit card processing fee properly.

i have entered deposit two different ways. One the exact way described in this post. When I do and run a report for my Credit Card Fees it does not show the name of the customer of the report when i do it this way. i have realized looking futher into it that it will only show the customer name if there is one deposit if there is multiple credit card deposits on the same deposit the report does not show the names. 

 

If there is only one invoice to match to the deposit i just match it on the transaction screen. I do not receive payment and then bank deposit. I just select (categorize MATCH Record as transfer) from the banking screen then select which invoice then on the bottom I select resolve deposit and take the fee from there. when I do this way it show up on my credit card fee report as type: expense and not a deposit and show the customers name. I am having a hard time getting a print screen and formatting it to the page. sorry

MJoy_D
Moderator

How to record credit card processing fee properly.

I can share some information that can help you with adding recording your transactions, @LoriTT

 

You may consider adding this credit card fee as an Expense

 

Here's how:

 

  1. Go to the + New and select Expense.
  2. Enter all the information needed. 
  3. Then, enter the customer name from the Customer column. 
  4. Click  Save and close once you're done. 

 

Check out this article for more information: Enter and manage expenses in QuickBooks Online. I'll guide you with recording, editing, and deleting expenses. 

 

From here, you can run the Deposit Detail report managing bank deposits. Here's how to run and customize this report: Run reports in QuickBooks Online

 

Let me know if you need further help in recording your transactions. I'm always here to help. Have a great rest of the day!

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