How do I categorize Venmo payments in Quickbooks if they are used to pay a vendor or subcontractor? Everytime I change one payment it changes them all? (2024)

‎March 18, 202005:40 AM

• QuickBooks Online

Venmo like paypal is just a service that transmit your money from one of your accounts to the vendor. It is not a credit card or liability just instant or nearly instant transfer.

So do not add venmo in your chart of accounts but as a payment method - like ACH. Record your payment within the bank account being used with reference as venmo. If you cannot add the venmo fee in that payment transaction you can always record it separately

I have a slightly different situation that I could not specifically find in the Community help. The business owner had a vendor initiate a Venmo transaction to the business credit card. The Venmo history showed a correct payment of $440. You have to look further into the payment details to see that there was also a fee of $13.20. The full amount of $453.60 was posted to the credit card. In QBO the total amount was posted to Uncategorized Assets. I matched that amount to the Credit Card Register. But I cannot unmatch it and expense it to the correct category and vendor. Any suggestions?

Thank you!

Hi there, @ keynq.

You’ll first need to check the Venmo history to see if the transactions are correct. Then, manually match the transaction to your QuickBooks Online. I’ll guide you how.

1. Go to theBankingmenu, then select theBankingtab.
2. On theFor Reviewcolumn, choose the correct transaction.
3. Select a customer or vendor name from theSelect Payeedrop-down.
4. Check that the selection in theCategoryfield is accurate, or choose a more specificCategory.

Then, here’s how to manually match the transactions.

1. Click the transaction to expand the view.
2. Review theRecords found. These transactions are ones you already entered in QuickBooks.
3. Review theDeposit to fieldon the forms.
4. When you’re done, selectMatch.

Once done, you’ll need to record aSplitfor the fee. You may follow the steps below.

1. Select the leftBankingmenu and selectBanking.
2. On theFor Reviewtab, select a transaction to open it.
3. Select theSplitbutton to open theSplit Transactionwindow.
4. Select aCategoryand enter anAmountfor each category to assign to the transaction until the total amount matches the downloaded amount.
5. SelectSave and Add.

For more details, you can also check this link:Assign, categorize, edit, and add your downloaded banking transactions.

For future reference, you can open this link to learn more aboutreconciliation.

Let me know if you need anything else. I would be happy to assist you. Have a great day!

Allow me to chime in, @kevynq.

You can view the bank matches from the transaction by clicking the blue hyperlink within the transfer that saysOnline banking matches. You'll want to un-match the transfer and change the account type to the correct category and vendor. Then, you can follow the steps provided by my colleague @CharleneMae_F to match the transactions and split the fee from Venmo. You may also find this article aboutediting transactionshelpful.

Feel free to comment below if you have any other questions. Best wishes!

Hi @kpagaduan12,

I'll share insight on your query about online banking payments in QuickBooks Online(QBO).

You can use a journal entry to transfer the transactions you saved from the account in question to the correct bank account. As for the specific accounts to use for the journal entry, I suggest you consult with your bookkeeper or accountant on the best way to proceed.

As for moving certain amounts from one bank account to another, see this article:Transfer funds between accounts.

In case you have other questions about online banking in QBO, post them below. I'll get back to you as soon as I can.

I use venmo as an option for customers pay invoices, I then transfer the funds in a lump sum to a business checking account.

I see you are suggesting not to add into the chart of accounts but then how would you suggest recording payments to the invoices and transfers from 1 account to the other?

Thanks

I'm having a similar problem.
Client is using venmo as a bank. Taking deposits and making payments from it, most of which do not go through her bank accounts at all. Although sometimes she transfers the funds to her bank account, and sometimes a venmo payment comes out of a bank account, but most of the time the in and out is in venmo alone I set it up in COA, but am perplexed as how to keep track, and balancing venmo seems impossible.

I was thinking of assigning an account number for transfer, for when it shows up in a bank account AND venmo, to show the flow-through, but now wonder if the actual cost should be itemized in venmo or the bank. Argh.

Welcome to the thread, @JENNILUNA13.

Venmo is a portal like Paypal use to pay expenses and receive money. As mentioned by @john-pero, you don't need to add Vendo to your Chart of Accounts (COA) but as a payment method.

So when receiving a payment, you can create a bank deposit to record it. And write a check or expense for money out transactions, then set Venmo as the payment method. For more details about this process, see these articles:

• How to Record Bank Deposits in QuickBooks Online
• Enter and manage expenses in QuickBooks Online

In your case, since you've set up Vendo on your COA, you can follow the suggested workaround provided by my colleague @Ryan_M, which is tocreate a journal entryto transfer the transaction. Then, consult your account on which account receives the debit or credit. This to ensure the correct posting of your books.

If you have any other questions or concerns in managing your transactions, let me know by commenting below. I want to make sure everything is taken care of for you. Have a great day.

I actually think the best way IS to connect Venmo to the COA using online banking. While Venmo is a payment method, it's also very much a bank account.

Hear me out: Download transactions from your bank and from Venmo. Record the income and expenses as normal against the Venmo account, as if it it were a bank account. Payments made through Venmo but deducted from your bank would be recorded as transfers to your Venmo balance (simple by way of Rule), and since they are recorded on both the bank side and the Venmo side, they balance. Cashouts from Venmo to your bank are recorded as transfers to your bank. You do have to pick a good starting point in terms of your "opening balance" in Venmo, but other than that, it's pretty simple and--dare I say--kind of great. I'm sure some expert will tell me I'm wrong, but it's working for me!

I am an expert at this - I would make this super simple and create sales income from the different POS transactions:

i.e.
Under Sales Income I would create sub accts as such:

The word Transfer used - when a POS transfers funds - can be confusing. But you have to remember the word and think how they are using it. When I see transfer - I know that it should be an add not a transfer - and you can create a rule for such.

@SOTUwrote:

I actually think the best way IS to connect Venmo to the COA using online banking. While Venmo is a payment method, it's also very much a bank account.

Hear me out: Download transactions from your bank and from Venmo. Record the income and expenses as normal against the Venmo account, as if it it were a bank account. Payments made through Venmo but deducted from your bank would be recorded as transfers to your Venmo balance (simple by way of Rule), and since they are recorded on both the bank side and the Venmo side, they balance. Cashouts from Venmo to your bank are recorded as transfers to your bank. You do have to pick a good starting point in terms of your "opening balance" in Venmo, but other than that, it's pretty simple and--dare I say--kind of great. I'm sure some expert will tell me I'm wrong, but it's working for me!

* Paypal Sales (when you receive a transfer from a sale paid by paypal)

* Venmo Sales (when you receive a transfer from Venmo - paid via Venmo)

* Stripe Sales (when you receive a payment from someone who paid via stripe)

If you set up a separate bank acct - you are doubling up on your income possibly.

If you using an outside POS - your sales transactions report come from that outside sales service. The transactions may or may not sync with QBO - it depends on the way you choose to set it up.

I would create a vendor called Paypal Vendor - since paying with pay pal does not give you much details other than a date and an amount.

Then you would put those to uncategorized transactions. As you will need to complete all the details for who you actually paid and what it was for: You can then export that list of transactions that need further detail - get that information and update those transactions with correct info.

So Paypal Vendor - would then be changed to Joe Schmoe - For supplies

"Payments made through Venmo but deducted from your bank would be recorded as transfers to your Venmo balance (simple by way of Rule),"

Have taken over bookkeeping for an NGO and trying to understand how to enter Venmo transactions properly. I understand the money coming in (deposits) but don't understand the payments. Can you give me an example of a payment made from Venmo which shows as a debit in the checking account? Want to be able to keep Venmo reconciled/balanced going forward. (New to Venmo)

I'm here to help share details about your transaction, @Gogo2.

You can create an expense or write a check to show a payment made through Venmo. Such entries will show the transaction as a debit to the checking account used.

Here are the links to use and learn more about each entry:

• Enter and Manage Expenses in QuickBooks Online
• Create and record Checks in QuickBooks Online

You may also read all related references in this article to make sure your account register matches your bank and credit card statements:Use this Guide Anytime you need Help Doing or Fixing a Reconciliation.

If you have any other clarifications or follow-up questions about bank transactions, please let me know by adding a comment below. I'll be here to lend a hand. Stay safe!

• Create and file 1099s using QuickBooks Online.
• Modify your chart of accounts for your 1099-MISC and 1099-NEC filing.

If you have any further questions or concerns about 1099 in QBO, please know that you can always tag my name. I'm here to help you in any way I can. Enjoy your day!