Transaction Fees - New System

ngranatelli

I'm having trouble accounting for my Square transaction fees in the upgraded system. I used to be able to split the transaction and then enter the full amount of the sale, then enter the amount of the transaction fee in a negative format to account for the fee. It keeps giving me an error code an won't allow me to do it now. How can I do this on the new system?

Alexia

Hi, @ngranatelli,

This is because splitting a transaction works a little differently now. In the old system, the two sides are considered individual transactions while it isn't exactly the case in the new version. Both parts need to be debits, or both need to be credits. I'm happy to show you how to handle this process now.

First, you'll need an "Undeposited Funds" account if you don't have one yet. This is an asset account under the "Money in Transit" account type. Once that's created on your Chart of Accounts, here's how you handle those sales.

1. Record the payment for the full amount to Undeposited Funds.
2. Create an expense transaction for the amount of Square's fee to Undeposited Funds, and categorize it to the expense category you usually use for those fees.
3. Transfer the rest to your bank account.

We are working on a way to make that process a little smoother, but as of now, that's how you'll have to handle accounting for these fees. Let me know if you have any questions!

trav2001

I just posted a similar question about Stripe. Didn't see this one before. Although. I don't understand the process. Can you give more of a breakdown on how to do this process?

No matter what I do I keep getting duplicate transactions when I attempt to follow these directions....?

Alexia

Hi, @trav2001,

I ended up following up with you in your other discussion. We can continue talking there, or stay here if you'd rather.

Cary

I am having a similar problem for a different reason. I received a $170 ACH withhdrawal from my credit card processor that included a $550 credit to one customer and a new $380 charge from another customer. I attempted to record this in two ways, as a -550 plus a +380 income, and as refund of 550 and income of 380. Neither works. The system does not allow any positive offsets to a withdrawal, which would be a nice simple way to handle this type of transaction.