How to Clean up Undeposited Funds in QuickBooks Online - My Cloud Bookkeeping

There are two ways to clean up undeposited funds in QuickBooks Online.  The correct way, and the quick way!

If you have old transactions in your undeposited funds account, this may have happened from a data transfer from QuickBooks Desktop, or another accounting program - the quick way may be an option.

If you would like to do this correctly it may take a little longer, the reward will be accurate results in your QuickBooks Online file!

If you are looking at recent transactions I would suggest that you track down the incorrect entries and match them up to the payment you have recorded.  This will take more patience!

In this video, I walk you through both methods.

If you have questions or comments, please use the comments box below. I would love to hear from you :)

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[kristineware]

This was so very helpful! Thank you for this video. What I've done was debit the sales and credit the undeposited clearing account.

[Squareonebookkeeping]

The client I serve switched invoicing software mid year in 2023. Not all line items in the Bank Deposit screen were matched to payments. A journal entry was made to "compensate" for the dollar difference. Now, the transactions are still in Bank Deposit and the journal entry is on the Bank Deposit screen as well. This video is very helpful.

[awaishmatani]

Thanks for giving an overview directly on screen

[pamelaolson]

Thank you! Very informative. Grateful you are sharing your intelligence! Learned A LOT!

[isaacleecollins]

Thank you so much! This was very helpful!

[JenniferMolinar-gx]

Great video. Thank you! What if you have deposits that also appear (incorrectly) as payments? What is the problem there? Exact amounts same customer.

[RachelOverton-vk]

Hi and thank you for this video. Can you please tell me the GL accounts affected when undeposited funds are "deposited". I'm not sure that makes sense but I'm trying to understand which accounts in the GL are affected by this process. Thank you kindly and your videos are amazing.

[DanielleGlenn-of]

I am using the first for 2022 pre taxes and 2nd to clean up 2021 filed taxes. thank you this was very helpful! I would like some videos on after the fact bookkeeping please.

[SheTechs]

I have a question, if you move old Und Funds to bank clearing account and then record as sales, does that not overinflate the P&L and would then affect Corporate Tax Payable?

[meghakamra]

We are cleaning up our cash account inQB, we have balance in books but no physical cash left as we didn’t record everything, now we have to write that off, do you have any suggestions on this.thanks

[MyCloudBookkeeping]

I would love to hear which method you chose and why! Also, how much did your income change after this clean up?

[FredWilliams-oy]

My situation is that I have two payments processed as paid through Quickbooks Online, however the funds were never received and therefore not deposited. Can I simply reverse the payment by deleting it?

[SusieCone]

How do you void those uncleared checks and if all your other account are reconciled will it affect those

[LuciaHewitt]

Thankyou for this video. My problem is a little different I think. I am running QB for monthly homeowners levies and when I started at the beginning of this year, I was inserting payments manully. (This was due to people doing deposits without enough information so I couldn't allocated the payment correctly). Now i have loads of uncleared payments. If I go in and allocate them at this late stage, won't it affect the balance on their invoice? i.e. If I'ved added a monthly value of 350 and then match the payment on the bank statement, won't it reflect that they've paid 700, when in fact it's only been 350?

[thehammer]

Do you offer any type of paid QBO training? The new company started in August 2023. Maybe look at my QBO, etc.

Thank you. Gary

[ScottGaither-hq]

I don't see the link for the finding and fixing duplicated deposits and or undeposited funds that are also doubled up

[saram]

How do you move CC payments or online QB payments from undeposited funds?

[chapter]

Thank you! What would you do if it is an old undeposited funds recording for a check received (from 2021 in my case) that never ended up being deposited into the bank account. This was before I started with the company - they recorded the check into Undeposited Funds when they received it, but then for who knows what reason, they never deposited the actual check so the funds never hit the bank and it is just sitting there recorded in Undeposited Funds.

[longbeachauto]

So I see some undeposited funds from past dates that have already been reconciled. So my question is: If I do the first method to clear them up, would this put my books out of balance?

[myvirzi]

Please help, I just started working at a company that is so far behind with their quickbooks bookkeeping. I'm creating invoices and back date them with payments for the jobs which the checks are already deposits into the account but now since I applied payment to the invoice that I have created is in the undeposited funds so what should I do in this case.