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Level 1

Late Fees are Accrued After Invoice Payment Date

I have the Late Fees functionality turned on. I can see that it is adding late fee line items to the past due invoices. So far, so good. However, after I post a payment against an invoice, the late fees are not adjusted for the payment posting. 

 

Example:

  • invoice created 1 Jan with a due date of 31 Jan.
  • On 1 Feb, late fee line items are added each day.
  • On 1 Mar, check is received from customer. At this point, late fees have been added for 29 days.
  • On 9 Mar, payment is posted against the invoice with a date of 1 Mar. 

At this point, my expectation is that the balance due on the invoice includes 29 days of late fees because that is when the payment was posted. However, what I am seeing is that the balance due actually includes 37 days of late fees, which is incorrect.

 

If someone can give some insight or practical experience with late fees, I'd appreciate it. Thanks.

Solved
Best answer April 02, 2020

Best Answers
Highlighted
Moderator

Late Fees are Accrued After Invoice Payment Date

Hi @nsosn,

 

I believe I can shed some light on the late fees function and why late fees continued to accrue.

 

QuickBooks is going to go by the date the check is recorded, not the date of the check.  For example, if the check was recorded on March 1st, the late fees would have stopped accruing.  Since the check wasn't posted until March 9th, the late fees kept accruing because QuickBooks didn't know that a check payment was received for March 1st.  

 

If the check was received March 1st, but not recorded until March 9th, QuickBooks won't go back and retroactively remove the late fees.  That would have to be done manually.

 

My suggestion would be to record the check payment on the day it is received, but put it into undeposited funds and record the deposit once it is posted to the bank.  That should halt the late fees.

 

Let me know if you have any other questions!

 

Lucas

View solution in original post

5 Comments
Highlighted
Moderator

Late Fees are Accrued After Invoice Payment Date

Hi @nsosn,

 

I believe I can shed some light on the late fees function and why late fees continued to accrue.

 

QuickBooks is going to go by the date the check is recorded, not the date of the check.  For example, if the check was recorded on March 1st, the late fees would have stopped accruing.  Since the check wasn't posted until March 9th, the late fees kept accruing because QuickBooks didn't know that a check payment was received for March 1st.  

 

If the check was received March 1st, but not recorded until March 9th, QuickBooks won't go back and retroactively remove the late fees.  That would have to be done manually.

 

My suggestion would be to record the check payment on the day it is received, but put it into undeposited funds and record the deposit once it is posted to the bank.  That should halt the late fees.

 

Let me know if you have any other questions!

 

Lucas

View solution in original post

Highlighted
Level 1

Late Fees are Accrued After Invoice Payment Date

Yes Lucas that does help explain why it is happening. 

 

But as far as the work around "record the check payment on the day it is received," that just seems not very practical unless you are dealing with a very small volume. Even then, weekends, holidays, people on vacations, etc. Its like saying you can't create an invoice for a future date or retroactively add a check that was written last week. Just not what I'd expect from an accounting system. As-of transactions are not that exotic.

 

I realize this is in beta, but I wish QB would have provided a better explanation of how it works before we turned it on. At this point, after I turn it off, I will need to go through and manually delete hundreds of line items from paid invoices. 

Highlighted
Moderator

Late Fees are Accrued After Invoice Payment Date

Hi @nsosn,

 

I completely understand where you are coming from.  I would definitely make sure to leave feedback in-product (go to the gear icon - select feedback) so that your opinions will be heard by engineers on this feature.

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Level 1

Late Fees are Accrued After Invoice Payment Date

But I never received a he payment into 

y baking account

Highlighted
QuickBooks Team

Late Fees are Accrued After Invoice Payment Date

Hey there, Rodney2131. Welcome to the Community.
 

When processing payments with a merchant account, the time frame for funds to reach your bank depends on the type of transaction. For credit cards, it can take 1-2 business days. Bank transfers can take 2-7 banking days.
 

There's also other factors involved. For example, if we send a deposit to your bank and they bounce it back to us, more time will be added to how long it takes for your money to reach you. If this happens, we'll notify you by email so that you're aware of what has occurred. For most reject reasons, we'll place a hold on funds going to your bank until its cleared up. You can reach out to your bank to fix the problem and then get in touch with Intuit to make us aware that the returned item has been cleared up. Once it's fixed, we can make sure any holds placed on your merchant account are lifted so that your money can continue to be funded to your bank account on file.
 

If this is your first time processing a transaction through your QuickBooks Payments account, there will be a review period where the funds will be held for five business days. We send email communications about this when it's occurring.

Always be sure to keep an eye on your email inbox. You'll see correspondence from us if anything out of the norm is occurring with getting the money you processed into your bank account.
 

Here's a few helpful resources that provide further information about funding time frames, bank rejects, and different types of funds on hold scenarios:


If you have any questions, feel more than welcome to reach out to me here. Have a wonderful day!

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