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How To Use The New Pay Down Credit Card Feature In QuickBooks Online

by Tracey Hrica, EA Jul 08, 2020 | Share

Many QuickBooks Online users are unsure how to record a credit card payment. Should you write a check or create a transfer? How should you categorize it?

Many users will mistakenly record the payment as an expense. When this happens, the payment doesn’t reduce the credit card liability account on the balance sheet as it is supposed to. It also incorrectly doubles up expenses on the Profit & Loss statement. You should have already entered these expenses individually in the credit card’s bank feed.

To address this, QuickBooks Online developed the “Pay down credit card feature.”

Let me show you how it works.

  1. From the +New menu, select Pay down credit card in the Other column.
  2. Select the credit card account that you have paid.
  3. Enter the amount of the payment.
  4. Enter the payment date.
  5. Select the account that answers the prompt, “What did you use to make this payment?” You also have the option to record it as being paid by check.
  6. Add any memos or attachments if desired.
  7. Save the transaction.

Now that you see how easy it is, why not try it yourself. QuickBooks Online offers a great tool in their sample company, “Craig’s Landscaping.” You have the opportunity to try new features without worrying about “messing up” your books.

You can access it here:  Craig’s Landscaping

Get help from a Certified QuickBooks ProAdvisor

With an in-house QuickBooks ProAdvisor, our accounting firm can help you save time with tips like this and more. We offer services from QuickBooks consulting and QuickBooks Online review to full-service bookkeeping, accounting, and tax services.

Whatever your QuickBooks needs, don’t hesitate to give us a call. Click below to view our Certified ProAdvisor’s profile.

QuickBooks Certified ProAdvisor Profile – Century Accounting & Financial Services

If you enjoyed this post, you might also want to check these out.

Help! My Business Receipts are Absolutely Everywhere This Year

QuickBooks Quick-Tip #1 – Save Time by Creating a Custom Report

About the Author

Tracey Hrica, EA

Tracey Hrica joined the firm in 1995 as a bookkeeper. In 2012, she earned the designation of Enrolled Agent(EA), which enables her to prepare personal and business tax returns and represent clients before the IRS. To maintain the designation of EA, she must complete yearly continuing education in the areas of personal and business taxation. Working closely with her clients, Tracey’s primary areas of concentration are new client onboarding, client communication, research, and QuickBooks support. As a QuickBooks ProAdvisor, she works closely with clients who rely on QuickBooks for the day to day running of their business. Tracey has expertise in both QuickBooks Desktop and QuickBooks Online.

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