Paying Vendors by Direct Deposit

Welcome to the Community, @SAustin.

I just got the information you need to set up vendors for Direct Deposit (DD) in QuickBooks Desktop (QBDT).

Before signing up for Intuit Direct Deposit service, make sure your vendor is a 1099 independent contractor and you have an active payroll subscription.

If you’re using QuickBooks Desktop Payroll Basic, Standard and Enhanced, direct deposit for paying employees must be active to activate paying 1099 vendors. 

Here’s how to sign up direct deposit for independent contractors:
1.    Go to Vendors from the top menu and open Vendor Center.
2.    Choose a vendor and double-click their name.
3.    On the Edit Vendor window, choose the Additional Info tab and select the Direct Deposit button.
4.    Once the Payroll Service Account Information opens, select the Activate link under Direct Deposit, next to 1099 Vendors for QuickBooks Desktop Basic, Standard and Enhanced. For QuickBooks Desktop Payroll Assisted, skip to the next step.
5.    Enter your Direct Deposit Pin and select Continue.
6.    Follow the onscreen instructions until you get to the Confirmation screen. 

Now, you’ll be able to start setting up your independent contractors for direct deposit. Make sure to collect their bank account information before paying vendors.

To add direct deposit information to your independent contractors follow the steps below:
1.    Go to Vendors from the top menu and open the Vendor Center.
2.    Choose a vendor and double-click their name.
3.    Select the Additional Info tab and click the Direct Deposit button.
4.    Choose the Use Direct Deposit for: [Vendor Name] box. Enter your vendor’s bank account information.
5.    Place a check mark on the box to select Send confirmation direct deposits to [email address] for Intuit to send an email confirming payment.
6.    When prompted, enter your direct deposit PIN.

For more information, check out this article: Manage direct deposit for independent contractors in QuickBooks Desktop Payroll. Screenshots are provided within the article.

If your vendor is not an independent contractor, you’ll need to sign up for QuickBooks Bill Pay as your payment service.

That's it. Please let me know if there's anything else I can do for you. I'll be here to help.  Wishing you and your business continued success!

Is it possible to set-up all vendors as 1099 vendors and use direct deposit instead of online billpay?

Thanks

Stan

Good day, orion678.

I'd be happy to help you set up and use direct deposit for your vendors in QuickBooks Desktop.

To answer your question, yes, you can set up all your vendors as 1099 and use direct deposit to pay them. You can follow the steps below to sign up your vendors for direct deposit.

1. Open the Vendor Center.
2. Select a vendor and double-click their name. The Edit Vendor window will open.
3. Choose the Additional Info tab and select the Direct Deposit button. This will open the Payroll Service Account Information page.
   
   
    
4. For QuickBooks Desktop Payroll Basic, Standard & Enhanced only: Under Direct Deposit, next to 1099 Vendors, select the Activate link. For QuickBooks Desktop Payroll Assisted, skip to the next step.
   
   
    
5. Enter your Direct Deposit PIN and select Continue.
   
   
    
6. Follow the onscreen instructions until you get to the Confirmation screen. Now you will be able to set up your independent contractors for direct deposit.<
   Continue below for steps adding direct deposit information to your independent contractors.

For detailed steps and instruction, check out this recommended article: Manage direct deposit for independent contractors in QuickBooks Desktop Payroll.

If you need more help in setting up and using direct deposit for your vendors, feel free to fill me in. I'm here to help you out.

What is the fee to pay vendors using direct deposit? I use QB Desktop and have a Basic Payroll subscription.

What is the fee to pay vendors using Direct Deposit? I have QuickBooks Desktop with a Basic Payroll subscription.

I can share some information about paying your vendors' direct deposit, @HLCLLC.

You must need to set up your contractor's direct deposit so you can direct deposit to pay vendors and 1099 independent contractors.

Here are the steps:

1. Set up direct deposit for your company. You'll need to have your business information, business bank account, and Principal officer information.
2. Connect your bank account from the Employees menu. Then, verify the bank account information.
3. Set up your contractor's direct deposit.

You can refer to the following article for detailed steps about setting up direct deposit for your company account and vendors:

• Set up your company payroll for direct deposit
• Set up and manage direct deposit for your contractors

Then, refer to the following reference on how to write a check to pay your contractors: Paying Independent Contractors using Direct Deposit.

To explain to you the fees that you'll be charged per transaction, I suggest reaching out to our Customer Support team. They can get into your account in a secure environment and verify this information. 

You can follow the steps below on how to reach them:

1. From your QuickBooks Desktop account, click the Help menu at the top.  
2. Click the QuickBooks Desktop Help menu and select QuickBooks Desktop Help.
3. Provide some information about this concern in the search box.
4. Click the Contact Us link at the bottom of the window. 
5. You'll now be provided with a few support options.  
6. Select Get a call to arrange a callback from a support agent. Or Start a chat to chat with them directly.  

Check this article for detailed guidance in reaching out to our Customer Support and our support hours: Contact QuickBooks Desktop support.

In case you'll encounter errors when processing these payments, here's how to resolve them: Error: The vendor payment transmission failed.

Let me know if you need further assistance managing your direct deposit transactions. I'm always here to help. Have a wonderful day!

After I pay a vendor with direct deposit if I pull up that payment it shows that it was sent however, the check shows up to be printed when I click on "Print Checks." What am I doing wrong?  The vendor is receiving the DD.  Do I need to manually enter EFT in the check number field?

Thank you for sharing your thoughts about the check processed through direct deposit, @JenPen. I want to assure you that you haven't done anything wrong, and I'm going to help you take care of this situation. I'm glad you reached out and am here to explain everything, so you understand what’s happening and provide some solutions.

When checks are paid through direct deposit, they won't appear in the list as needing to be printed. However, if you want to print the check, you can click the Print icon, and you may also add EFT for recording purposes.


 

If you checked the box for "Pay Online," that check won’t appear as pending for printing; instead, it will show up as "SEND." Please refer to the screenshot below.


 

On the other hand, if you ticked the box for "Print Later," the check will indicate "TO PRINT," and it will show up as pending for printing.
 

I recommend taking a moment to verify that you’re looking at the correct check on the print list. There’s a possibility you might be viewing a different check for the same vendor. Make sure the box for "Pay Online" is selected.
 

To verify:
 

1. Head over to the Vendor Center.
2. Select vendor name.
3. Click the Transactions tab.

Additionally, you can use QuickBooks to create and file 1099s for contractor payments. This feature streamlines the process, ensuring that you can easily manage your contractor payments and comply with tax reporting requirements.

If you still have questions or there's something else you’d like clarity on regarding printing checks, please don’t hesitate to add them in the comments below. You can always tag me and I’ll make sure to respond as soon as possible. I'm here for you and will keep this thread stays open for you to share any additional thoughts.

Thank you ShangY for your reply.  I did double check to make sure that the checks showing when I go to "Print Checks"  are the ones that were sent through Direct Deposit and they are.  I double checked with the vendors and they did receive their deposit.  I decided to write a new check for the next DD and I noticed that it automatically has both "Print Later" and "Print Online" checked with a check number filled in so I unchecked "Print Later" and changed the check number to "EFT."

Is this the correct thing to do?

Hi JenPen,

You're on the right track by unchecking Print Later and manually changing the check number to EFT. This is what you need to do to keep everything consistent with a direct deposit payment, and it will allow QuickBooks to properly record the transaction without generating an unnecessary printed check.

By unchecking Print Later and using EFT for the check number, you're ensuring that the payment is recorded correctly without triggering the print process. Also, ensure that the Pay Online box is selected for future direct deposit payments, as this will prevent the payment from showing up in the print queue.

Aside from vendors, you can also consider checking the status of your employee direct deposits in QuickBooks Desktop.

Let me know if you have additional concerns about direct deposits in QuickBooks Desktop. I'm always here to assist you.