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Handling direct deposit returns

You may receive a direct deposit return if your employee's or vendor's bank account in not specified correctly in QuickBooks. When you receive a return on a Direct Deposit paycheck from the payroll service, QuickBooks receives the amount of the returned paycheck as a deposit in your bank account (not as a payroll transaction, in the case of paychecks).

To do this task
  1. Open the register of the bank account you use for direct deposits (either payroll or vendor payments).

    Open the register.
  2. Edit the return deposit and change the Received From name to the employee or vendor for whom the return was received.

    When you specify the employee, QuickBooks displays this transaction on the employee's QuickReport, but not on any payroll reports for the employee.

  3. Write a regular check (using the Write Checks window) to the employee or vendor for the direct deposit check amount.

  4. On the Expenses tab, assign the amount to the Direct Deposit Liabilities account.

    If an error message window appears, click Cancel to dismiss it.

  5. Save the check.

    Save the check.

(QuickBooks does not display this check in payroll reports for the employee.)

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