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Level 2

Payment made to a personal account instead of business account - need to show invoice as paid

 
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Best answer 07-19-2019

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Level 12

Re: Payment made to a personal account instead of business account - need to show invoice as paid

Pay no or little attention to the two answers from reps. You cannot directly deposit a payment sitting in Undeposited Funds into an off the books bank account via owner draw (which is what this represents)

 

Two methods

1. Create a clearing bank type account. Deposit payment into clearing account. Record expense from clearing account to Owner Draw (equity) if you later deposit the funds into the business it will be Owner Contribution.

 

2. Receive payment into Undeposited Funds. Create deposit into any existing bank account but add a negative line item of equal amount to Owner Draw account resulting in a zero sum deposit

 

#2 is simplest and is one step

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6 Comments
QuickBooks Team

Re: Payment made to a personal account instead of business account - need to show invoice as paid

It's nice to see here at the Community, @GolfNut72.

 

You'll need to match the payment to the invoice and record a bank transfer. Let me show you how to do it.

 

Here's how:

  1. Go to the Banking menu.
  2. Select the blue tile for the account you want to review.
  3. Go to the Reviewed tab.
  4. Select the link in the Added or Matched column to review the transaction.
  5. Add any additional info you need.

To make a bank transfer:

  1. Go to Plus (+) icon.
  2. Under Other, select Transfer.
  3. From the Transfer Funds From drop down list, select the bank account that the funds.
  4. From the Transfer Funds To drop down list, select the Bank Account the funds are being deposited into.
  5. In the Transfer Amount field, enter the amount being transferred.
  6. Edit the Date.
  7. Select Save and close or Save and new.

For more references, you can read this article: Match and categorize your downloaded bank transactions.

 

Please let me know if you need anything else. Have a nice day!

Level 2

Re: Payment made to a personal account instead of business account - need to show invoice as paid

GraceC -

 
Thank you for your reply but I probably didn’t give you enough details regard this situation or explain it correctly.
 
Invoice was sent to client by email
Client responded by paying invoice, but instead of sending it to the business account, they sent it to a personal bank account that is not part of QBO, and not tracked at all.  (It was sent using Zelle)
Spoiler
 
 
I need to understand how to record the invoice as being paid.  Does it require a Journal Ledger entry against the Owner’s Distribution, or is there another way to handle it without the JE.
 

Thank you

Moderator

Re: Payment made to a personal account instead of business account - need to show invoice as paid

Thank you for the additional information you've shared, @GolfNut72!

 

You can create a receive payment transaction so you can mark your client's invoice as paid. I'm here to share a few insights and help you from there.

 

To start with, here's how you can receive payment:

  1. Go to the Plus icon.
  2. Under Customers, select Receive Payment.
  3. Select your client and enter the payment amount.
  4. Click Save and close.

In addition, here's an article you can read to learn more about receiving payments: Record a Customer Payment.

 

This way, payments will be recorded to your undeposited funds account and you can match them once it has been downloaded to QuickBooks. From there, you can follow the steps shared by my colleague, @GraceC, so you'll be guided on how to do the tasks.

 

In case you need some tips and related articles in the future, you can visit our QuickBooks Online Help Articles page for reference.

 

If there's anything else that I can help you with, please let me know in the comment section down below. I'll be always around ready to help.

Level 2

Re: Payment made to a personal account instead of business account - need to show invoice as paid

I understand receiving the payment but what account does it get deposited it too, since the funds are never received by the business account. In this particular case, the client kept the funds in his personal account as a distribution from his business (he is a Schedule C business). If it is received to Undeposited funds, how is it removed from that account? There is an Owner's Distribution account, but it's not seen as a bank account. Thank you
Level 12

Re: Payment made to a personal account instead of business account - need to show invoice as paid

Pay no or little attention to the two answers from reps. You cannot directly deposit a payment sitting in Undeposited Funds into an off the books bank account via owner draw (which is what this represents)

 

Two methods

1. Create a clearing bank type account. Deposit payment into clearing account. Record expense from clearing account to Owner Draw (equity) if you later deposit the funds into the business it will be Owner Contribution.

 

2. Receive payment into Undeposited Funds. Create deposit into any existing bank account but add a negative line item of equal amount to Owner Draw account resulting in a zero sum deposit

 

#2 is simplest and is one step

View solution in original post

Level 2

Re: Payment made to a personal account instead of business account - need to show invoice as paid

John - Thank you, I knew there was a simple answer for this, it just wasn't coming to me. I appreciate the help

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