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michelle104
Level 1

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

I have received 2 payments via QBPayments and both of them show as category UNDEPOSITED FUNDS. I can't find anything in Help to tell me what to do. All my settings point to the Operating Account and the Invoices designated the income category to post to.
9 Comments
JamesDuanT
Moderator

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

Let get this thing sorted out, michelle104.

 

When using QuickBooks Payments, the invoices are marked as paid after your customers send the payment.

 

In QuickBooks Online, the payment will be deposited to the Undeposited Funds or to the bank account. This depends on your Payments settings:

  1. Click the Gear icon in the upper-right corner and select Account and Settings
  2. Select the Payments tab and go to the Chart of Accounts section.
  3. Review where the payments and fees are deposited.
  4. Click Save and Done.

Meanwhile, your bank will receive the payments which were already deducted by the processing fees.

 

If the payments are by default deposited to the Undeposited funds, you still need to create a bank deposit that includes the processing fee. You can browse this article for the detailed steps: Record and make Bank Deposits in QuickBooks Online.

 

With that, you should be able to match it to the Banking page once the payments are cleared from your bank.

 

We'll get back to you if you have additional questions about the process. Have a great day!

 

Raffy_Welding
Level 2

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

JamesDuanT, thank you for your helpful message.  I am having the same problem.  Unfortunately, I reconciled the quickbooks payments before noticing they were in "undeposited funds".  Now, I cannot change it to be "accounts receivable".  I have tried "un-reconciling" to move it to banking, so that I can change it.  When I do this, it drops all of the invoice linking in the deposit entry in the register.

 

When the quickbooks payment comes in from the bank, it links to the invoice via match.  When I then view the deposit in the register using "edit", I can see the quickbooks payment ID, the payee, and the invoice link.  I cannot figure out how to change it to "accounts receivable" and still maintain this data.

 

How can I fix this 1) to change to accounts receivable? and maintain the invoice link and qb data, and  2) to avoid having this problem in the first place?

I have already done what you said above, watched the video, and still have the problem. Thanks in advance for any help you can give me.  I am using ONLINE.

DivinaMercy_N
QuickBooks Team

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

Hi there, @Raffy_Welding.

 

Undeposited Funds account is used to hold invoice payments and sales receipts you want to consolidate. When you have your deposit slip, you'll have to make a bank deposit in QuickBooks to combine payments in Undeposited Funds to match

 

You need to deposit the amounts to your desired accounts, to fix the Undeposited Funds. Go to the Bank Deposit page. You have a customer payment entered to that account but not deposited. You'll need to find the deposit (it is in there because the transaction is already reconciled). Then, update the deposit with the customer payment and remove the line item that is in there and was reconciled.

 

For more details, you can refer to this article: Deposit payments into the Undeposited Funds account in QuickBooks Online.

 

Also, I've added this helpful article in case you want to review your transactions after matching them: Find, Review, and Edit Transactions in your Account Register.

 

Should you have any other questions that I can help you with, feel free to leave a reply below. It's my pleasure to help you get back on your working track anytime. Take care always. 

michelle104
Level 1

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

This didn't work for me.  In settings, my deposits have always been set to the Operating Account.  Using Quickbooks Online Payments (payments processed by sending a QB invoice to a client that they process electronically via CCard or Bank transfer) is the ONLY time I've seen this.  When I go to NEW/DEPOSIT, there is $0.00 there. 

 

When I look at my Operating Account Register, there only 2 deposits made via QB Online Payments and they both show up as UNDEPOSITED FUNDS in the Operating Account Register.  Is this correct? 

 

The deposits seems to show up correctly in my P&L.  In my Balance Sheet transaction report, it shows up as a"System-recorded deposit for QuickBooks Payments" to the Operating Account with a slit to UNDEPOSITED FUNDS. At least now it is showing up in the correct category of income, and i'm not sure how that happened.  I just don't like seeing UNDEPOSITED FUNDS in my bank register.

Raffy_Welding
Level 2

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

@DivinaMercyN, thank you for the reply.  I really appreciate it.

I guess I need to know the correct way to deposit quickbook payments.

 

Right now, I download from my bank feed, go to the banking Review, and the quickbooks payment "finds" the invoice, then I hit Match.  Then, it goes into my bank register perfectly with the invoice matched up and the quickbooks ID number, BUT it is put into "undeposited funds".  This is how I got into this mess.

 

I asked QBSupport on an hour long chat with sharing screen, and they gave me a very long process to fix this.  Their instructions were:  Open the invoice, click on payment upper right, click on date that pops up, then upper left click on date for bank deposit.  When this comes up, click More then Delete.  Then open invoice again, click on payment upper right, click on date that pops up, then, click More then Delete.  Now the invoice is "overdue".  Go to register, Unreconcile deposit, go to Review, edit deposit by changing to Accounts Receivable, then hit Match, then check the invoice box, then save.  Then go to register, and R "re-reconcile the deposit.

After I do this, the deposit is correct with Accounts Receivable, and linked to the invoice, but the data that shows that it was paid by QB is gone, so I have to add "quickbooks payment" to the memo line, and also have to be sure to fix the date to match the deposit date from my bank because this whole process changes the date.

I am struggling with this process since many of my vendors pay this way, and I pay a bank fee for the service.

Customer Service told me to NOT enter my quickbooks payments using the bank feed data in the Review window. 

I am not sure how to do it any other way.  If someone could tell me the "correct" way to process quickbook payments, the steps I should be doing, I would really appreciate it.  If that means I avoid using the bank feed that is ok, but this process is taking me hours.

Raffy_Welding
Level 2

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

@DivinaMercy_N, oops one more thing.  After I do this very long process, I get entries put into my Chart of Accounts Undeposited Funds register for each deposit, with a $0 payment.  So I now have a very long list of these, and no idea what to do with them.

IamjuViel
QuickBooks Team

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

Hello, @Raffy_Welding.

 

I appreciate you for sharing feedback about your experience. Let me share some information on how you to accurately track the invoice payments in your account. Then, matched it with your downloaded bank transactions and lastly, reconcile. 

 

To start with, when you create an invoice, it increases your Accounts Receivable (AR) balance.

Once you pay the invoice, it decreases the balance of your AR. At the same time, it increases the balance of your income account or the bank where the actual invoice payment is deposited. You can view the transaction journal to verify this.

 

Once completed, you can match it with your downloaded bank transactions from the For Review page.

3040.GIF

By matching your transactions, you'd avoid getting duplicate records in your bank's register. 

3041.GIF

Keep me posted if you have other questions about tracking your income and expense transactions. I'm always here to help.

KK101
Level 1

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

I'm having a similar issue. The UNDEPOSITED FUNDS are matched to my bank feed correctly. The issue is that these quickbooks payments are not showing up in my income statement as income. Please help!

Joesem M
QuickBooks Team

Online Quickbooks Payments matched to the invoice when downloaded from the bank are getting categorized to UNDEPOSITED FUNDS! Nothing is pointed to UFunds! Plz Help Me.

Thanks for joining this thread, @KK101.

 

Allow me to chime in and help share information on how to resolve your concern in QuickBooks.

 

Let's make sure that the bank transactions are added or matched with the bank feeds. This way, QuickBooks will recognize the payments as income.

 

  1. Select Banking.
  2. On the Banking page, select the For Review tab.
  3. Select the transaction you want to add or match.

Joesem Molat1.JPG

If it's already added or matched, we can review the account you used for the items of your invoice since that will be the basis of the bank register once it will be deposited from the Undeposited Funds to the correct bank.

Joesem Molat1.JPG

 

Here's an article with a video tutorial for your reference: Categorize and match online bank transactions in QuickBooks Online.

 

For your future reference, you may consider reading this article to guide you in reviewing your accounts to make sure they match your real-life bank statements: Reconcile an account in QuickBooks Online

 

If there's anything else I can help you with, please let me know. I'll be around to help. Have a great rest of your day!

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