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howiereiss
November 8, 2024
Question

Bank deposits (income) are incorrectly attributed to an expense category

  • November 8, 2024
  • 1 reply
  • 0 views

I created 85 "October 2024 special assessment" invoices for shareholders in a co-op.  When the income amount is paid, they show up on the bank transaction tab (from our linked bank account) as a deposit for either "matching" or by categorizing it to the appropriate shareholder and account type (ie - October special assessment).  But when I confirm the transaction, it gets applied to an expense account (Legal Fees).  QBO Care has been unable to determine why this is happening.

How can a bank deposit (income item) that pays a specific receivable get applied to an expense??? Has anyone else had this happen?  I've spent over 6 hours on the phone over a period of a month with the QB experts to no resolution.  

      1 reply

      J
      Jovelyn_M1
      November 8, 2024

      I appreciate your time and effort in attempting to resolve the issue of the bank deposit being incorrectly categorized, Howie.  Let's work together to identify the root cause of this problem and ensure all entries are accurately categorized.

       

      There are scenarios we can explore to determine this issue. First and foremost, QuickBooks Online (QBO) depends on the data from your financial institution. Additionally, make sure that your account set up is correctly classified as income.

       

      To check, here's how:

      1. Go to the Gear icon and select Chart of accounts. Then, choose the accurate account.
      2. In Actions, select dropdown then Edit.
      3. Double check the Account type. Make sure it is Income.

       

      Since it is wrongly applied as expense, we can recategorized these transactions from expenses into income.

       

      Finally, we can also check if there are bank rules that are already set up which assigns the deposit under an expense account once added in QBO.

       

      I've added this resource as future reference in case you wanted to reconcile your account: Reconcile an account in QuickBooks Online.

       

      You can get back here in Community space if you have further questions related on QuickBooks categorization, reconciliation and etc. I'll be more than willing to assist.

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