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Level 2

How to record payments to multiple vendors and payroll through a third party PEO

How should I record payments to vendors who we pay through our PEO (Justworks)? Right now vendors send me an invoice and I enter it in Quickbooks. Then I set up the EFT payment in Justworks, and when they process it they invoice me (often with multiple vendors and sometimes payroll on the same invoice). I also enter the Justworks invoice in Quickbooks, because we pay them the lump sum amount which they distribute to the vendors and employees, and I need to match the payment to the invoice to reconcile our bank account. So the problem is that we now appear to have double accounts payable - the actual vendor invoice, and the justworks invoice, for the same thing. Any advice?

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How to record payments to multiple vendors and payroll through a third party PEO

Hello there, @edenwillow.

 

Thank you for posting in the QuickBooks Community. Let's get these employee and vendor transactions sorted out for you so can continue doing your work.

 

To fix this, you need to create a transfer from the actual bank account that the group payment came out to the payment clearing account.

 

To do that, let's start with creating a clearing account. You'll use that bank account for the Deposit To: field when receiving payment and for the Payment Account: field when paying a bill.

 

Here's how:

  1. On the left pane, click Accounting.
  2. Select Chart of Accounts.
  3. At the top right, click New.
  4. Select Bank for the Account Type.
  5. Select Cash on hand for the Detail Type of bank account.
  6. Enter the account name. (Example: Clearing Bank Account)
  7. Select Save and close.

To record the payment:

  1. Go to Create (+icon, then select Receive Payment.
  2. Choose the Barter Customer from the drop-down menu.
  3. From the Payment Method field, select Add New and then enter Barter in the name field.
  4. Click Save.
  5. Pick your clearing bank account in the Deposit To: field.
  6. Click Save to record the transaction (see the first two screenshots below).

To pay the bill using the payment deposited in the clearing account:

  1. Choose the Create (+icon and then click Pay Bill.
  2. In the Payment Account drop-down menu, select the clearing bank account.
  3. Pick the bill you want to pay.
  4. Enter the amount of the bill payment and record the transaction by clicking Save.

I've also added an article for future reference: Record a Barter Transaction.

 

You can also reach out to our phone support to further assist you. They can initiate a screen sharing session to resolve your concern quickly. 

 

That should do it. Keep me posted once you get to try these steps or if you have any other questions about recording payments through a third-party. I'll be happy to answer them for you.

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