undeposited funds account

@ametz1201 

How many entries are we talking about?  If the entries are sitting in undeposited funds (UF), then you must have deposited them some other way otherwise your bank account would be short those funds.  So, how did you get those funds into your bank account?  Did you make additional deposits or ???  Every entry to UF also affected another account like A/R since this is double-entry accounting after all.  Therefore, you need to look at each UF entry and the other entry where the funds were deposited into your bank account to figure out how to clear the UF entries. 

For example, say you received payment on an invoice that went into UF, but not understanding why it wasn't showing in your bank account, you made a bank deposit in QB and assigned an income account to the deposit.  You now have an entry into UF as well as a duplicate entry to income (one from the invoice and one from the deposit).  To clear the UF entry, you would need to make an entry that reduces UF and also reduce your income since your income is overstated.  To do that, you have a few options: 1) you can make an expense transaction, use UF as the payment account and select your income account as the category or, 2) make a journal entry: debit your income account, credit UF. 

If you can provide more info, I can try and assist further.    

I understand how important clearing out your undeposited funds without messing up your book, @ametz1201.

On top of that, I'd like to recognize your effort in searching for videos online on how to fix it. Let me add some info to help you zero out the undeposited funds without affecting your book.

To avoid affecting your account balances, we can use a clearing account to transfer the amounts. To create this account, utilize these steps:

1. From the Transactions tab, select Chart of accounts.
2. On the upper right corner, click the New icon.
3. In the Detail Type dropdown, choose Cash on hand.
4. Complete the account details.
5. Tap Save and Close.

Once done, we can move the amount from the Undeposited Funds account to the clearing account using journal entries or record transfers. Yet, I recommend reaching out to your accountant for additional guidance.

After that, we can inactive the clearing account so the system will zero out its balance. Here's how:

1. Go to Transactions.
2. Select Chart of accounts.
3. Look for the clearing account we created.
4. Click the dropdown arrow beside the View register. Then, choose Make inactive.
5. A prompt will show. Pick Yes, make inactive.

For future help, if you want to combine multiple transactions in a single record so QuickBooks matches your real-life bank deposits, you can read this article: Record and make bank deposits in QuickBooks Online.

If you have additional questions about managing your bank deposits and accounts, don't hesitate to come back here. I'll be willing to lend a hand. Have a good day.

Just wondering if you found any answers to how to clear the undeposited funds account in your QBO. I have the same issue with our quickbooks.  The funds have cleared the bank and all accounts are reconciled, but the P&L and balance sheet are not correct at all.  I saw there is about $10,000 in undeposited funds.  I have no idea what that is or why it is there, but I have feeling it has something to do with why the reports are not correct. Need help. I have watched a lot of videos, but nothing yet corrects the situation.