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crisstax
Level 2

Is PayPal Undeposited Funds useful?

When PayPal automatically records transactions it records them into the undeposited funds' account. When I check the bank deposits screen most transactions are posted without the fee amount. (I also have two missing transactions). Why do we need to use undeposited funds for PayPal when all the money goes directly to the PayPal account, and from there we just need to record a transfer to the bank account?

 

Therefore, I am not understanding the dynamics of the undeposited funds with PayPal because it makes me double work the entries. 

 

Note: I am only recording sales receipts without invoicing. 

Solved
Best answer June 20, 2021

Best Answers
GlinetteC
Moderator

Is PayPal Undeposited Funds useful?

Hello, Crissa. I appreciate the workaround you've provided.

 

I can help share additional information on how to clear up the Undeposited Funds account. 

 

To fix these deposits, it would depend on how they're deposited. You'll want to create a giant deposit and drop down a line with a negative amount of the total deposit to clear the funds. 

 

Please make sure to fill in the correct information on the Deposit page. First, check your register and see what is the category of the deposits, either sales or income account. Once done, use that account when creating the deposit under the Account column on the Add funds to this deposit section. However, it would be best to consult your accountant for the category or account to use.

 

I'm adding this article to learn more about deposits in QBO, How to Record Bank Deposits in QuickBooks Online.

 

For future task, here are articles you can read on how you can manage your bank deposits:

 

If I can be of any additional assistance in managing bank transactions, please add them below. I'll be glad to help.

View solution in original post

4 Comments
Adrian_A
Moderator

Is PayPal Undeposited Funds useful?

Hi crisstax,

 

You have me to help you resolve your concerns.

 

 

Let's start with your PayPal account. The settings in your PayPal account might be the possible reason that your transactions automatically downloaded into the undeposited funds account. We can review it through these steps:

 

  1. Go to the Banking menu.
  2. Look for your PayPal account and then click the pencil icon.
  3. Choose Edit settings.
  4. Click the pencil icon to change some settings if needed. 
  5. Once done, select Save

 

As for the missing and without fee amount transactions, let's try opening the Bank deposit page on an incognito window. 

 

There are times that an issue like this occurs when the system encounter a browser-related concerns. We can use these keyboard shortcuts to open one:

 

  • Google Chrome: Ctrl Shift N
  • Mozilla Firefox: Ctrl Shift P
  • Microsoft Edge: Ctrl Shift P
  • Safari: Command Shift N

 

If it works, we can go back to a regular browser and clear its cache. We can also switch to a different supported browser like Google Chrome, Mozilla Firefox, Safari, or Microsoft Edge as alternative.

 

You may want to check this article that will guide you further on how undeposited funds works in QuickBooks Online: Deposit payments into the Undeposited Funds account in QBO.

 

Please let me know how it goes. I want to ensure that everything is taking care of. Stay safe!

crisstax
Level 2

Is PayPal Undeposited Funds useful?

Thank you, but it did not work. 

 

First of all, I went ahead and looked at the PayPal settings, but there are no options for undeposited funds there. I cannot choose anything. Second, in the future, it would be helpful if I could edit it, but in the meanwhile, I had this issue at hand. So, what I simply did that finally worked for me was to check the outstanding deposits (which had already been deposited) and changed them from Undeposited Funds to PayPal, however, they showed as additional receipts, so I went ahead and deleted them in the end. That finally zeroed out my undeposited fund's account. 

 

I also checked the incognito window, just in case, but nothing was there. 

 

Thank you for your tips. 

 

 

GlinetteC
Moderator

Is PayPal Undeposited Funds useful?

Hello, Crissa. I appreciate the workaround you've provided.

 

I can help share additional information on how to clear up the Undeposited Funds account. 

 

To fix these deposits, it would depend on how they're deposited. You'll want to create a giant deposit and drop down a line with a negative amount of the total deposit to clear the funds. 

 

Please make sure to fill in the correct information on the Deposit page. First, check your register and see what is the category of the deposits, either sales or income account. Once done, use that account when creating the deposit under the Account column on the Add funds to this deposit section. However, it would be best to consult your accountant for the category or account to use.

 

I'm adding this article to learn more about deposits in QBO, How to Record Bank Deposits in QuickBooks Online.

 

For future task, here are articles you can read on how you can manage your bank deposits:

 

If I can be of any additional assistance in managing bank transactions, please add them below. I'll be glad to help.

View solution in original post

crisstax
Level 2

Is PayPal Undeposited Funds useful?

Thanks for this alternative method on how to clear undeposited funds, pretty interesting. 

 

Funny thing, I am my own accountant. Just learning a little bit more every day. 

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