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Yes, your contractor will receive an email notification when the direct deposit payments are scheduled and settled. With that said, the direct deposit process can no longer be stopped.
What we can do right now, is to do an internal agreement with the contractor. They can do bank transfer or ACH to return the money.
It is not necessary to delete the duplicate check. In QuickBooks Online, we can do any of the following to offset the amounts.
Here's how to create the bank deposit:
Here's how to create the journal entry:
Also, you can browse this article to know more about the Contractor Direct Deposit.
You can always get back to me if you require additional help with this. Have a great day!