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Join nowI am trying to set up a Barter transaction. I have created the Barter {bank} account but I don't know how to set up the Payment type for the Payment Method. I was told to use Other by an accountant but that then promps me for the card number and expiration which is not correct.
Great to have you here in the Community, @cbalogh05. You're almost on the right track. I'm here to help you set up your payment method.
When setting up the Barter payment method in QuickBooks, using the Other account type as suggested by your accountant is appropriate. You can leave the fields asking for the card number and expiration blank, as barter transactions do not involve actual card payments.
Additionally, setting up a payment method manually can streamline the process, allowing you to avoid repeatedly inputting payment details when accepting payments. Here's how:
If one of the accepted payment method options is missing (Visa, MasterCard, Discover, or AMEX), re-create it manually.
To provide you with more details, you can check out this article: Add, edit, or disable a credit card
You can use the following guides to help you manage your vendors' and customers' transactions more efficiently:
If you have any further questions setting up your payment method, leave them in the comments section below. I'm always ready to respond to them.
If you're using a Clearing Account (same as a Barter Account), there's no need to set up a payment type. A Clearing Account is used as an offset (A/R for A/P, etc.) so there is no payment involved. Just set it up as a bank account and you should be all set.
Rainflurry: If I don't accept a payment, won't this invoice stay outstanding forever? I don't know the "clearing account" terminology. Can you help further?
Also, does this interfere with reporting income (an IRS issue)?
The Barter arrangement is with a customer who also a dentist so I am bartering IT for Dental work. Does this affect the scenario? I don't have any other Barter customers (and don't plan too)..
Is there a reason why the Quickbooks KB documents on this topic talk about creating an invoice AND an offsetting bill (from the dentist - which I do not have).
You still need to receive payment on the invoice, you just don't need to specify a payment type (cash, check, etc.).
A clearing account can be used in a number of accounting transactions. It works the same as a barter account, however, it can be used in other accounting entries. I like to have as few accounts in the chart of accounts as possible. t's cleaner that way.
Using the clearing account as the offset will not affect the income or expenses on the invoices and bills.
The reason you need an invoice and bill is because you need to enter both of them to offset. If the dental work is personal, the IRS would not like personal expenses reducing income.
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