I have an invoice for per diem. I have a category for travel:per diem. QBO wants to 'match'. If I do it will be income instead of reimbursement. How do I connect them?

Proper categorization is essential for maintaining clear financial tracking and adhering to compliance regulations. @BAM4. Let's work together to keep your finances in excellent shape.

Could you please share how you recorded the per diem? Did you set up a separate item to track these transactions before issuing an invoice? If that is the case, it is imperative to use a designated reimbursement account for this item, rather than an income account. This approach ensures that it will not be counted as part of your business income, helping to maintain accurate financial records and ensuring that taxes are calculated correctly.

If this is a downloaded transaction, this cannot be matched with the invoice. As a workaround, you can exclude them and manually receive payment so that only those transactions need to be reconciled.

Here's how to exclude bank transactions:

1. Go to Transactions, then select Bank transactions.
2. Choose the For Review tab.
3. Select the checkbox of the transactions to exclude.
4. Press Exclude.

Once done, please refer to the steps below on how you received the payment in QuickBooks Online (QBO):
 

1. Click +New and select Receive payment.
2. Click the name of the customer from the Customer dropdown.
3. Choose the payment method.
4. From the Deposit to dropdown, select the account you put the payment into.
5. In the Outstanding Transactions section, select the checkbox for the invoice you're recording the payment for.
6. Once done, click Save and close.

I'd highly recommend contacting your accountant, who can provide expert guidance on how to manage this transaction accurately.

I'm adding this article that tackles reconciliation to ensure your account is balanced and accurate: Reconcile an account in QuickBooks Online.

Additionally, you'll want to seek additional guidance from our QuickBooks Live Expert Assisted team. They can offer specialized guidance on categorizing your transactions accurately and provide insights on maintaining a clear and comprehensive record of all your financial activities.

I've got your back if you have more questions about categorizing your transactions in QBO, @BAM4. Just leave a comment below, and I'll be back.