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jsanterre50
Level 2

Quickbooks payments

I am confused and needs a workflow spelled out for me.   I have a client who sent an invoice to a customer.  They paid it online through Quickbooks Payments with a credit card or ACH transfer.   On my end I see that the payment was paid and eventually deposited into the correct bank account with a bank receipt done automatically through Quickbook payments.   However, the payment is still in Undeposited Funds?  Why?  I need to understand why this was happening so we can correct any Quickbook payments in the future.  I right now have a huge undeposited funds account.    All I am looking for is how Quickbook payments work and why after they show deposited in the bank are still in undeposited funds.  

5 Comments
VivienJ
QuickBooks Team

Quickbooks payments

Hi there, jsanterre50, 

 

Thanks for elaborating the situation and sharing how you've processed the payments from the Merchant Account into QuickBooks Online. I have just the workflow you need to record the transactions. 

 

Once your customers pay you via QuickBooks payments, the invoices created in QBO will automatically be marked as paid. Then, those payments will be posted in the Undeposited Funds.

 

To remove them from the Undeposited Funds account, make sure to link these payments to the deposit you'll be creating. This way, the money will move to your actual Business Bank account. 

 

Here's how:

  1. Go to the Plus icon, then select Bank Deposit.
  2. In the Choose an account field, pick the bank account you want to put the deposit.
  3. Put a check mark on the payments to deposit in the Select the payments included in this deposit or QuickBooks Payments sections (see screenshot below).
  4. Click Save and Close.

Check out this article for a more detailed steps:

 

How to record bank deposits

 

You can opt to remove the deposit you've first created and proceed with this process. To do so:

  1. Go to Accounting, then Chart of Accounts
  2. Look for the bank account you're referring to, and click View Register
  3. Locate the specific deposit.
  4. Click Delete, then Yes

With these steps and resources, you can successfully record the payments in QuickBooks Online without them getting stuck in the Undeposited Funds account. Please keep in touch with me here should you have any further questions or concerns. Wishing your business continued success! 

 

 

jsanterre50
Level 2

Quickbooks payments

Thank you for responding.   I however still have a question. 

 

 If quick book payments is automatically making a bank deposit and a bank receipt by depositing the QuickBooks payment done by CC or ACH into the correct bank account why is it still showing in undeposited funds?  Is there a step that the client is missing with each QuickBooks payment and what is that? 

 

 I assume that since QuickBooks payments did everything there was nothing for the customer had to do but match it on their Bank downloads.  

ShiellaGraceA
QuickBooks Team

Quickbooks payments

You'll want to choose the correct bank account to record your payments from the settings, jsanterre50

 

Here's how to get there:

  1. Click Gear, then Account and Settings.
  2. Click Payments.
  3. In the Chart of Accounts section, click the pencil (edit) icon.
  4. For Where do you want to record payments?, choose the correct bank account.
  5. For Where do you want to record processing fees?, choose the proper expense account for tracking processing fees.
  6. Click Save.
  7. Click Done.

Doing these steps will auto-update and auto-deposit your money into your bank account.

 

You can always swing by whenever you need help with anything else.

mybills11
Level 1

Quickbooks payments

Good morning,

 

I was reading the info related to QBO payment merchant workflow and I am not sure the question as to why if QBO deposits the funds in the corresponding bank a/c, why then the funds still show on undeposited funds.  If QBO matches the invoice to the deposit.

In my case I see that my client has two entries on undeposited funds: (1) payment and (2) deposit.  May I know why and how to properly follow the flow.

In an effort to understand the process we undid the deposit; however, this didn't change the total undeposited funds balance it has now created two additional entries without an invoice number with a credit to A/R which when trying to delete it says that I have to undo the deposit when the deposit is correct.  It is the duplicate that is incorrect.  Appreciate your assistance

 

Jovychris_A
QuickBooks Team

Quickbooks payments

Hello, let's sort this out, @mybills11.

 

QuickBooks Online automatically records deposits and fees for your QuickBooks Payments transactions. Make sure that you have configured QuickBooks Payments account to match and designates automatically. You may check if the appropriate accounts are selected.

 

Here's how:

  1. Go to the Gear icon.
  2. Under Your Company, select Account and Settings.
  3. Choose the Payments tab.
  4. In the Chart of Accounts section, select your accounts and save.

Ensure that the deposit account selected is the same account received payments get deposited to. It should also be the same account where fees are deducted from in real life. For reference, you can check this article on how Undeposited Funds account work in QuickBooks: Deposit payments into the Undeposited Funds account in QuickBooks Online.
 

In your case, you've created the deposit as an income account, which is why it duplicates your deposits.

 

To fix this, you can check for duplicates in the bank register and remove them from there.

 

Let me show you how:

  1. Go to the Gear icon and then select Chart of accounts.
  2. Click the View register on the Action column for the bank account in question.
  3. When you see the duplicates, review the transaction.
  4. Once confirmed, click the entry and then choose Delete.

Additionally, I'll share with you some articles on how you can handle the funds that show in the Undeposited Funds:

If you have other questions, feel free to place a comment here. I can help you anytime. Take care!

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