Receiving Payments in QuickBooks Online

It’s probably your favorite activity in QuickBooks Online: recording payments from customers. Here are the options.

QuickBooks Online was designed to make your workflow fast, intuitive and easy. This is especially true of the interface upgrade that some of you are seeing now (Intuit is rolling out this new look in stages; screen shots displayed here come from the new version).

Receiving payments from customers has never been particularly difficult or time-consuming in any version of QuickBooks, but recent changes have streamlined the process even more.

What really streamlines the process of getting paid, though, is the ability to accept credit and debit cards. We highly recommend that you provide this option to your customers. If you’re not yet set up with a merchant account, we can help you get started.

A Common Scenario

The timing of your payments mandates the type of transaction you’ll use to record them. Probably the most common scenario occurs when you send invoices and your customers submit payments.

There’s more than one way to accept those payments in QuickBooks Online, but probably the easiest involves simply clicking on the Customers tab in the left vertical pane. Then click on the colored tab at the top of the screen that displays a dollar amount and the total number of open invoices.


Figure 1: Click on the middle bar in this navigational/informational tool in QuickBooks Online to see a list of your company’s unpaid invoices.

QuickBooks Online displays a table listing all of the customers with open invoices, the number unpaid and the current balance due. Click the Receive payment link in the ACTION column for each customer to go directly to the Receive Payments screen (if that link isn’t showing, click the down arrow, which displays additional options).

Links in the PENDING INVOICES column show how many invoices are open, and their status. Clicking on this link takes you to a list of transactions, which should be open to Invoices. You can select one or more by clicking in the box to the left of the customer name and then clicking the Receive Payment button in the ACTION column.

However you get there, the Receive Payments screen works the same. The customer’s name should already have been selected. Change the Payment date if necessary and select your payment method from the drop-down list, enter any related reference number and select the correct account for the money (ask us if you’re not sure). To the far right, enter the Amount received in the box supplied. Check the box in front of the invoice(s) that should be paid, and make sure that the Payment in the box on the far right is correct.QBO0514image2_zps7086ebdc

Figure 2: It’s easy to accept payments in QuickBooks Online. The site does some of the work for you.

If you have a merchant account and have enabled QuickBooks Payments, you’ll be able to record a payment using the customer’s credit or debit card (major cards are supported). When QBO0514image3_zps579d1348the customers receive invoices, they’ll be able to send their payments back electronically, which will have a positive effect on your accounts receivable and cash flow. The Online Payment button in your sales screens should be turned on when you’re creating the invoice.

Other Options

If a customer should pay you at the same time that the products or services are received, don’t create an invoice. Instead, click the + button at the top of the screen and select Sales Receipt in the Customers column. Fill in the blanks like you would in other sales forms.

Customers may occasionally make a down payment or pre-payment on a product or service. You can process this through the Receive Payments screen (click the + sign and then Receive Payment in the Customers column to get there) and apply it to an invoice later. If you already know what the items or charges will be, you can create an invoice and record the payment as a deposit.

There are multiple ways to receive payments in QuickBooks Online. You can even do so from the invoice screens themselves. So find what fits best into your workflow. You work hard to produce the products and services that your company sells; make sure that customer payments always reward that effort accurately.


For more information or assistance, contact Brenda J. McGivern, P.C. at 866-895-1614 or visit

Billing for Time in QuickBooks: An Overview

If you sell your employees’ time and skills, you can use QuickBooks to record those hours and bill your customers for them.

If your small business sells products, you know how precisely you must track your starting stock numbers, ongoing inventory levels, and your reorder points. QuickBooks provides tools to help with this process, but human factors can sometimes throw off your careful counts.

Fortunately, QuickBooks is remarkably flexible when it comes to recording the time your employees spend on customers and jobs. You can enter information about a single activity — either billable or unbillable — and/or document hours in a timesheet. A built-in timer (the “Stopwatch”) helps you count the minutes automatically; you can also type them in manually.

One Work Session

All versions of desktop QuickBooks include dialog boxes designed to help you enter all the details related to a single timed activity. To get there, either open the Employees menu and select Enter Time | Time/Enter Single Activity or click the down arrow next to the Enter Time icon on the Home Page and choose. Pic1

Figure 1: QuickBooks helps you create records for individual activities completed by employees, which can be either billable or unbillable.

You fill out the fields in this window like you would any other in QuickBooks. Click the calendar icon in the DATE field to reflect the date the work was completed (not the current date), and click the down arrows in the fields that contain them to select options from a list. If you already know the duration of the activity, simply enter it in the field to the right of the clock icon. Otherwise, use the Start, Stop, and Pause buttons to let QuickBooks time it.

The Time/Enter Single Activity dialog box is designed to record one activity, not necessarily an entire workday, unless an employee only provides one service for one customer in a day. If he or she provides more than one service for one or more customers, you’ll need a fresh record for each.

Note: If the employee selected is timesheet-based, an additional field will appear above the CLASS field asking for the related PAYROLL ITEM. And if you’ve turned on workers’ compensation (and the employee is timesheet-based), a field titled WC CODE will drop into place below it. This must be done absolutely correctly, and it can get complicated. We can help you manage this feature.

A Comprehensive View

At the top of the Time/Enter Single Activity dialog box, you’ll see an icon labeled Timesheet. If you click on this with an employee’s name selected, his or her timesheet will open and display the hours already entered for that period. Or you can open a blank timesheet by opening the Employees menu and selecting Enter Time | Use Weekly Timesheet. You can also click the Enter Time icon on the Home Page.


Figure 2: You can access an employee’s timesheet from the Time/Enter Single Activity dialog box, from the Employees menu, or from the Home Page.

If you’ve entered all of the hours individually for an employee in a given time period, the timesheet should be correct when you click through from the Time/Enter Single Activity box. If not, you can edit cells by clicking in them and changing the data. Be sure that the Billable box is checked or unchecked correctly.

You can also enter hours directly on a timesheet instead of recording individual activities. Just select the employee’s name by clicking on the arrow in the NAME field at the top of the Weekly Timesheet dialog box and fill in the boxes.

Note: Individual activities that you enter for employees are automatically transferred to the timesheet format and vice-versa.

Billing for Time

QuickBooks keeps track of all entered billable hours and reminds you of them when it’s time to invoice. If customers have outstanding time and/or costs, this dialog box will open the next time you start to create an invoice for them:



Figure 3: This dialog box is one of the ways QuickBooks helps you bill customers for everything they owe.

QuickBooks also provides several reports related to billing for time. We’ll be happy to go over them and – as always – help with any other questions you might have.



7 Facts about Income Tax Extensions

Not sure you’ll be prepared to file and pay your total taxes due by April 15? Here’s what you need to know about filing an extension.

Sometimes, things beyond your control keep you from making that April 15 income tax filing deadline. Family emergencies. Too much time traveling for work. An overly complicated financial situation. Missing – required – forms from third parties.



Even though tax filing season is 2-1/2 months long, sometimes you’re just not ready. The IRS makes allowances for this by offering a six-month extension period. If you think you’re going to miss  that mid-April milestone for the 2013 tax year, you should know that:

Anyone can file for an extension. If you’re a U.S.taxpayer, you’re eligible to file for what the IRS calls an “automatic” extension. The agency does not require an explanation for your request.

 The IRS still wants you to pay your anticipated tax obligation by April 15.  

As the agency states on the required form, Although you are not required to make a payment of the tax you estimate as due, Form 4868 does not extend the time to pay taxes.

Does this mean that you absolutely must submit all of the money owed by April 15? Again, in the words of the Internal Revenue Service, Your extension will be automatically processed when you pay part or all of your estimated income tax electronically.

We recommend that you pay all of what you anticipate owing if at all possible, but at least submit as much as you possibly can.TaxTips0314image2_zps4f2a2149

The IRS charges interest on late payments made via an extension. You’ll pay interest on any unpaid tax amount until you pay in full.

The IRS will assess a late payment penalty for every month or part of a month past April 15, 2014 that total tax remains unpaid. Generally, the charge runs one-half to one percent of your taxes due (except for any estimated tax you paid). Max is 25 percent.

You can ask that the late payment penalty be waived because of your circumstances. If you think that you have a good reason for the penalty to be excused, attach a written explanation to your 1040 when you submit it. In order to be considered for penalty forgiveness, the IRS requires that you’ve paid at least 90 percent of your 2013 tax liability by April 15, 2014. These funds can come in through withholding or estimated payments, and/or they can accompany the Form 4868.

You may also be given a penalty for filing late. Late filing penalties are usually charged when a return is filed after the due date (including extensions). The IRS normally calculates it as 5 percent of the amount owed for every full or TaxTips0314image3_zpsf8ce103bpartial month. Max is 25 percent. Here, too, the IRS may waive the fee if you attach a statement explaining the reason for your tardiness.

There are three ways to file a Form 4868 (the form required when you request an extension). You can:

1. File the Form 4868 using the Electronic Federal Tax Payment System (EFTPS), and submit the entire amount due or a portion of it. You can also use a credit or debit card.

2. E-file the Form 4868, or

3. Use the official IRS Form 4868 paper form.

Sometimes, a late tax return is unavoidable, and it’s worth paying the extra fees to make sure that your return is correct. But if you find yourself making a practice of filing extensions because you either wait too long to pull together your financial documents or you can’t pay the full amount on time given the amount of your obligation, talk to us about year-round tax planning. April 15 doesn’t have to be a day to dread.





5 Ways You Can Use QuickBooks’ Income Tracker

The Income Tracker is one of QuickBooks’ more innovative features. If you’re not using it, you should be.

One of the reasons that QuickBooks appeals to millions of small businesses is because it offers multiple ways to complete the same tasks, which accommodates different work styles. Say, for example, you wanted to look up a specific invoice. You could:

  • Go to the Customer Center and select the customer, and then scan through the list of transactions,
  • Use the Find feature (Edit | Find), or
  • Create a report.

There’s also another way you can get there if you have a recent version of QuickBooks: the Income Tracker. (Note: Only the Administrator or a staff member with the correct permissions can access this feature. Talk to us about whether to allow other employees to use it, and how to set that up.)


Figure 1: QuickBooks’ Income Tracker provides a visual overview of your company’s income.

That’s the first thing you can do with QuickBooks’ Income Tracker. To get there, either click the link in the vertical navigation bar or go to Customers | Income Tracker.

Four colored bars across the top of the screen represent unbilled estimates, open invoices, overdue invoices, and invoices paid within the last 30 days. Each bar contains two numerical values: the number of transactions of that type and the dollar amount involved.

QuickBooks defaults to displaying all types of transactions, but when you click on a bar, the screen changes to show only that type of transaction.

You can also filter the table of transactions using the drop-down lists below the colored bars. Your choices here include Customer:Job, Type, Status (Open, Paid, etc.) and Date (range). Click the arrow to the right of each filter’s label to display your options.

The column labels below these lists will change depending on the transaction type that’s active.

More Functionality

The Income Tracker is great for simply viewing groups of transactions; double-clicking on one will open the original form. You can also open them by selecting an action to take. For example, open your estimates list and click on a transaction to highlight it. Then click the arrow next to Select in the Action column at the far right end of the row.


Figure 2: You can modify transactions like estimates from within the Income Tracker.

If you choose the first option here, QuickBooks opens a small window that asks you whether you’d like to create an invoice for 100 percent of the estimate, a percentage of it, specific items, or percentages of each item. When you make your selection and click OK, a completed invoice form opens, which you can then check over and save.

As you can see above, you can also mark the estimate as inactive, print it, or email it.

Each transaction type supports a different set of actions. In the open invoice action column, as you’d expect, you can click the option to Receive Payment, which opens the Customer Payment window with the customer and amount due already filled in. This can be edited to reflect a different amount, or you can just accept it as is, then save it.

Flexible Forms

You can even create a new transaction within the Income Tracker. Click on the arrow next to Manage Transactions in the lower left corner of the screen and select the form you want.


Figure 3: You can open new transaction screens from within QuickBooks’ Income Tracker.

The Income Tracker also provides one of the fastest ways to print multiple forms. Just select the transactions you want to print by clicking in the box in front of them, and then click the arrow next to Batch Actions in the lower left corner.

Finally, you can edit transactions from here, too. Either double-click on one or select it and click Edit Highlighted Row in the Manage Transactions menu.

QuickBooks’ Income Tracker doesn’t do anything that can’t be done another way in the program. But it provides an excellent one-glance view of the current state of your receivables movement.

If you’re consistently seeing patterns that you don’t like, call us. We can evaluate your receivables process and suggest ways to accelerate it. Even if your sales aren’t increasing, getting that “PAID” stamp on invoices quickly will improve your cash flow and strengthen your confidence as a business manager.