How to mark an invoice as paid in QuickBooks

Gather the payment details first: which customer paid, how they paid, how much arrived, and the account in QuickBooks the money should sit in. The invoice needs to be saved already, because the payment form lists the customer's outstanding invoices for you to tick.

If your bank lumps several customer payments into a single deposit, Intuit's approach is to record each of those payments to the Undeposited Funds account. That lets you combine them into one bank deposit later. Intuit says to do this only when your bank really does combine payments. If the money has already come through your bank feed, the how-to on applying a payment to an invoice covers matching that deposit instead.

The steps below are for the new version of the Receive payment form.

1. Select + New (it may show as + Create), then choose Receive payment.
2. From the Customer dropdown, pick the customer who paid. A customer who isn't set up yet can be added with + Add new.
3. From the Payment method dropdown, choose how they paid, or add a method with + Add new.
4. From the Deposit To dropdown, choose the account the money is going into.
5. In the Amount received field, type what the customer paid. It can be the full invoice amount or a part payment.
6. Under Outstanding Transactions, tick the box for the invoice this payment is for. With a single invoice ticked, the amount you entered fills both its Payment column and the Amount to Apply.
7. Select Save and close.
8. To see what the customer still owes, go to Reports, select Standard reports, then find and open the Customer Balance Summary report.
9. Select Run report and check the customer's figure in the Total column, which is their open balance.

The payment is saved as a transaction of its own, tied to the invoice. You'll find it in Sales transactions, and the invoice links to it from its top right corner. The money is recorded in the account you chose in Deposit To, and the customer's remaining balance reflects what was paid.

A part payment leaves the rest of the invoice open. QuickBooks works through the invoice's line items in order with each part payment, and the next payment picks up from the following line until the invoice is fully paid.

The payment isn't fixed once saved. If the customer actually paid more or less than you entered, open the payment from Sales transactions, change Amount received, and select Save and close. Voiding or deleting a payment has its own how-to, and a deleted payment can't be brought back.

Reversing a card payment that was processed through QuickBooks is a separate job. Intuit draws a line between voiding, which cancels the transaction as though it never happened, and refunding, which sends money back to the customer.

No Deposit To dropdown? That's expected when a merchant account processes your payments. Not sure which payment belongs to an invoice? Open the invoice and select the payment link in its top right corner. And if you edit or delete a payment that's linked to other transactions, QuickBooks alerts you automatically.