How To Record a Bounced Check In QuickBooks

A bounced check from a customer is recorded as a non-sufficient funds check in QuickBooks. The record a bounced check feature, present by default in QuickBooks, can be used to record such checks, ensuring the accuracy of your accounting data. Although users can manually record a bounced check, we highly recommend that you rely on the inbuilt feature meant for recording such issues. If you want more business customization then go for professional QuickBooks Checks.

Record a Bounce Check

Recording a Bounced Check Returned From Customer QB

You must switch to single-user mode to record a bounced check via the built-in feature. Only if the check payment was made through the Customer Payment window, then it can be marked as bounced; otherwise, the bounced check would have to be manually recorded.

Record bounced check icon is grayed out: An issue faced by many, the grayed out icons imply that the bounced check will have to be recorded manually.

You have to go for only QuickBooks Compatible Checks , otherwise you will get alignment and printing issues .

How to Enter a Bounced Check in QuickBooks Desktop?

QuickBooks Desktop provides the option to record a bounced check that you receive from a customer as payment in sales receipts or invoices. QuickBooks tags the invoice as ‘unpaid’ and lets you enter the fee charged by the bank for bounced checks.

QuickBooks Desktop will make a new invoice for the NSF (non-sufficient funds) fee levied by the bank and you must send it back to the customer along with the bounced check. Follow the instructions given below carefully to file a bounced cheque.

  • Open QuickBooks Desktop and proceed to ‘Customers’ from the top menu bar.
  • Then, click on the ‘Receive Payment’ option in the customer menu.
  • In the next window tab, locate and choose Customer payment canceled due to check bounce.
  • Now a new window named ‘Receive Payments‘ will open.
  • In this window tap on the ‘Record Bounce Check’ option in the top right side corner.
  • After that, another window called Manage Bounce Check will open.
  • Here, enter the fee charged to you by the bank for the bounced check and enter the date in the column next to it.
  • Then choose the expenditure account from the drop-down menu from which NSF (Not Enough Funds) was charged by the bank.
  • Select a class if you have class tracking enabled in QuickBooks.
  • In the Final Customer Charge field, enter the amount you desire to charge the customer for the bounced check.
  • Inspect all areas and then tap on the Next button.
  • In the Bounce Check Summary window, QuickBooks will display the bounces that occurred when you recorded the check.
  • Take note of transactions that are marked as unpaid by QuickBooks.
  • After reviewing for the last time, press the finish button.

Now the only thing left is to send the new bounced check fee challan generated by QuickBooks along with the original challan.

QuickBooks Option To Enter Non-Sufficient Funds (NSF) Bounce Checks

Use the bounced check feature by following the steps provided below:

  1. Go to the Customers menu, and click on Customer Center.
  2. Click on the Transactions From the provided options, and select Received Payments.
  3. Select the check payment which is to be marked as bounced.
  4. From the Main Ribbon tab, Select Record Bounced Check If the icon is disabled/grayed out, then you need to follow the manual steps.
  5. In the Manage Bounce Check window, enter the following information:
    1. Bank Fee Expense Account
    2. Customer Fee
    3. Class
    4. Date
  6. In the View the Bounce Check Summary, you’ll receive one of the following messages:
    1. The following invoices will be marked unpaid.
    2. The following fees will be deducted from your bank account.
    3. The invoice will be created for the fee you want to charge your customer.
  7. Review the information and click on Finish.

Note:: Don’t record the check in the undeposited fund’s account. By definition, a bounced check must have already cleared the bank.

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Adding a customer fee will ensure that the customer pays an extra amount for providing a bounced check. This is usually an accepted practice, but you can choose according to your preference.

Enter a Bounced Check in QuickBooks Online

There are several steps you need to follow if you prefer to use the expense method to record a bounced check. First, you need to add the returned check as an expense. You can then remove the returned check payment from your original invoice. You can then determine the item(s) for the returned check and enter the service charges charged by the bank. Once done you can generate an invoice for the returned check fee and send the details to the customer.

Follow each step to record a bounced or returned check in QuickBooks Online using an expense.

  • #1 Step: Add Returned Check as an Expense
  • #2 Step: Remove the Returned Check Payment from an Original Invoice
  • #3 Step: Make a Service Item for the Returned Check Fees from the Bank
  • #4 Step: Add the Service Fee Your Bank Charged You
  • #5 Step: Make an Invoice for Returned Check Fees
  • #6 Step: Send the Statement to the Customer

Manually Recording the Bounced Check QuickBooks Step By Step

Any check with a grayed-out bounced check option must be recorded as discharged manually. In a vast majority of cases, the option is grayed out for checks which weren’t recorded using the customer payment window.

Manually record a check provided by a customer as bounced by following the steps provided below:

  1. To record the check as bounced, first, create a new Income Account.
    1. Select Chart of Accounts from the Lists
    2. Select New from the Account dropdown
    3. Select Income Account as Account Type. Click on Continue.
    4. Input the name as ‘Bounced Check Income’.
    5. Enter any additional details and click on Save & Close.
  2. To record the customer fee, create a new item.
    1. Select Item from the Lists
    2. Select New.
    3. Click on ‘Other Charge’.
    4. Enter the following details:
      1. Amount: 0
      2. Account: Select the Bounced check account from Step 1.
      3. Item Name: Bad Check Charge
      4. Tax Code: Non-taxable
    5. Click on Save.
  3. To reverse the original payment, create and post a new journal entry.
    1. Select Make General Journal Entries from the Company menu.
    2. Debit the amount for the bounced check from the Accounts Receivables account.
    3. Credit the amount for the bounced check from the bank account which will receive the funds.
    4. Enter the description, memo, and customer/job name.
    5. Click on Save & Close.
  4. Select Customer’s Receivables from the Reports
  5. Click on Customer Balance Detail.
  6. Click on the line which holds the record for the bounced check.
  7. Remove the invoice which was paid for by the bounced check and replace it with the reversing journal entry.
  8. Click on Save & Close.
  9. Send the e-invoice to the customer. You can also include a payment link.
    1. Add the customer fee:
      1. Select the Invoice.
      2. Click on Add the Bad Check Charge Item.
    2. Click on the Email icon and select Send.

Note:: It isn’t necessary to send the invoice to the customer, nor is it mandatory to include the customer fee for the bounced check.

QuickBooks For MAC Record Bounce Checks

If you’re using QuickBooks for Mac, then follow the steps provided below to mark a check as bounced:

  1. Select Receive Payment from the Customers
  2. Select the desired check, then click on Bounced Check.
  3. Enter all the required information: customer fee, bank fee, bank name, etc.
  4. Hit Next and review the information.
  5. Click on Record. View the status and click on Finish.

If you need more help QuickBooks For MAC Desktop Support team ready to assist you .

QuickBooks will provide you with a detailed explanation of everything that happens behind the scene when a check is marked as bounced.


The option to mark the check as bounced is grayed out. Why?

When the icon is grayed out, it means that the check must be marked as bounced manually. So instead of the bounced check feature, you’ll have to rely on a reversing journal entry.

What to do with an undeposited check?

As mentioned in the article, a bounced check cannot be undeposited. Only after you deposit a check, it will be marked as bounced. Need more information connect to the QuickBooks Support team now.

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