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How the Undeposited Funds account works

The Undeposited Funds account is a holding account, similar to holding money in a drawer until you make a deposit to your financial institution. When you receive customer payments, use a payment item on an invoice, or enter a sales receipt, the funds are held until you are ready to make a deposit in QuickBooks.

Note: If you are not using accounts receivable functions such as invoices and payments, or if you take individual payments to your financial institution (rather than a batch of payments), you can bypass the Undeposited Funds account by using the Make Deposits window (found on the QuickBooks Banking menu). For more information about making deposits, please see the QuickBooks Help topic Depositing customer payments.

Functions of the Undeposited Funds account:

  1. When you receive a payment from a customer, select the option Deposit to Undeposited Funds. Selecting this option transfers the payment to the Undeposited Funds holding account until you deposit the payment into a QuickBooks bank account.
  2. When you deposit the money to your QuickBooks bank account (it is still necessary to use the Make Deposits window noted above), you will first see the Payments to Deposit window, which lists all the transactions holding in the Undeposited Funds account.
  3. Select the transactions you want to deposit and click OK. QuickBooks enters the transactions in the Make Deposits window. When you save the deposit, the amount is transferred from the Undeposited Funds account to your QuickBooks bank account.
  4. Using the Undeposited Funds account allows you to group your deposits in QuickBooks to match your deposits to your financial institution. You can then easily reconcile your statement with the QuickBooks bank account.

 

If this information does not answer your question, you can read discussions and post messages and questions relating to your issue on the Intuit QuickBooks Community site for free. You can contact an agent for additional guidance. Fees may apply.

 

 


 

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