How to Reconcile PayPal Account in QuickBooks and QuickBooks Online?

To make sure of the steadiness of the data you recorded in PayPal and QuickBooks, it is highly recommended to […]

To make sure of the steadiness of the data you recorded in PayPal and QuickBooks, it is highly recommended to reconcile the accounts. This detail can include the fees, transactions, payments, etc. Hence, reconciling it becomes crucial for the users.

In the QuickBooks accounting software, your particular PayPal account can be reconciled through the Reports menu plus the Reconciliation Reports feature. When you think of reconciling it in the QuickBooks Online version, you will need to start by accessing the Undeposited Funds option.

In today’s article, we will talk about reconciling a PayPal account in QuickBooks with ease. Not to mention, the method can be used for QuickBooks Online too.

But before we move further, we must learn the advantages of reconciling a PayPal account in QuickBooks.

What are the Benefits of Reconciling PayPal Accounts in QuickBooks?

Here is the list of the benefits of reconciling PayPal account in QuickBooks:

  • Handle Your Business Efficiently: Prepare invoices, take snapshots of receipts, or check the activities of your company from the mobile app for QuickBooks anywhere and anytime.
  • Automate Your Expenses: Handle your vendors and your bills. Create recurring payments for automatic payment of bills without any issue.
  • Manage Expense: Link with your credit card and bank account for automatic categorization and downloads. Plug into the particular applications that you are using for easy integration.
  • Link Apps that you use Already: You need to sync data from renowned apps such as Shopify, PayPal, QuickBooks Time, and many more.
  • One-click Reporting: You can instantly check the performance of your business. With just a single click, you can witness your Profit and Loss, Balance Sheet, and several other reports.
  • Dashboard Overview: Expenses, outstanding invoices, income, and other key business financials can be viewed the moment you sign in.

How to Integrate PayPal with QuickBooks Online?

Here are the steps to integrate PayPal with QuickBooks Online seamlessly:

Step 1: Link QuickBooks Online with PayPal Balance

  • First, you need to log in to your QuickBooks Online account
  • Now, on the Banking page, press the option Connect Account
  • Locate PayPal from the list of banking institutions. You need to log in to PayPal and then follow the instructions to prepare a secure connection

Step 2: Configure Integration Settings

Once the connection is done, you need to set up the integration settings in order to match the PayPal transactions with the right QuickBooks Online categories and accounts. You need to modify the parameters as per your particular business structure and accounting preference.

Step 3: Automation Rules set up

Make the most of automation rules in QuickBooks Online to streamline the process of integration. You need to state rules for handling fees, categorization of transactions, and reconciliation of sales data. Automation makes sure of accuracy and consistency in financial reporting.

Step 4: Reconcile Accounts Daily

Daily reconciliation is important to maintain precision in financial records. Sometimes, review the PayPal transactions in QuickBooks Online and then reconcile the inconsistencies. This approach makes sure that your financial data stays reliable and updated.

Step 5: Use Analytics and Reports

Increase the benefits of integration by leveraging the analytics and reporting feature in QuickBooks Online. Issue custom reports that offer insights about transaction trends, PayPal sales performance, along customer behavior. Such reports enable you to make data-driven decisions that can work wonders for your business.

Now let us learn how to reconcile PayPal in QuickBooks.

How to Reconcile PayPal in QuickBooks?

In order to match your details from PayPal with QuickBooks, the Reports menu can be used. This menu helps you in reconciling your particular account on the platform for payment processing. Additionally, you can also select Find Report by Name. With the help of such an option, you can use Reconciliation Reports. Such reports can be used to implement the steps that are remaining.

To properly understand how you can successfully reconcile PayPal in QuickBooks, the steps given below can be implemented:

  • In your QuickBooks, you must have access to Reports
  • The file below should be viewed:
    • Find Report by Name
  • In the given field, you must state Reconciliation Reports
  • Select Account once you click the drop-down symbol
  • Click on Report Period
  • The period should be set to the following:
    • All Dates
    • The arrow close to the visible year should be pushed
    • Now, Access the link for View Report

Note: This particular link helps in comparing the reconciled reports of QuickBooks and PayPal.

How to Reconcile PayPal in QuickBooks Online?

In a bid to reconcile the PayPal account in QuickBooks Online, you must use undeposited funds and also include the bank deposit. In order to do it, you need to choose the Undeposited Funds option in your PayPal. Then, begin adding the payments concerning PayPal. After these are added and registered, the negative deposits will need to be included.

Note: Together with knowing how to reconcile PayPal in QuickBooks Online, the following steps should be used to record your bank deposits too.

  • Open PayPal and then sign in to your account
  • In the starting, use Undeposited Funds and then add the payments of PayPal
  • Now the bank deposit needs to be recorded in PayPal
  • From the Undeposited Funds option, choose the payment
  • Navigate to Add New Deposits
  • In this option, Negative deposits need to be recorded

Post this, the payments of your PayPal account will need to get reconciled with your particular QuickBooks Online account.

How to Reconcile Bank Statements in QuickBooks?

Here are the steps to reconcile bank statements in QuickBooks:

  • Navigate to the Bank Reconciliation page in QuickBooks
  • Now submit a statement date and statement balance amount
  • Begin the Reconciliation process

What are the Issues of QuickBooks Bank Reconciliation?

  • To prevent errors, businesses must balance their bank accounts on a monthly basis. Users are reassured of the following by routine bank account reconciliation in QuickBooks:
  • This procedure can be used to fix the issue. Users can also examine differences between banks’ records and their own.

Having prompt notification of any potential fraudulent transactions is also advantageous.

To guarantee that the findings are correct, users are advised to routinely reconcile their bank and credit card accounts within QuickBooks.

The primary use of the PayPal and QuickBooks reconciliation is to confirm that the transactions match. There could be no need to rely on difficult procedures with the techniques presented here. You might require extra assistance while reconciling your PayPal account in QuickBooks and QuickBooks Online.

To learn about How to Reconcile PayPal Transactions to QuickBooks, click here. Also, to get knowledge about other solutions, read our other blog on How to Import PayPal Transactions into QuickBooks.

Accounting Professionals, CPA, Enterprises, Owners
Accounting Professionals

Looking for a professional expert to get the right assistance for your problems? Here, we have a team of professional and experienced team members to fix your technical, functional, data transfer, installation, update, upgrade, or data migrations errors. We are here at Dancing Numbers available to assist you with all your queries. To fix these queries you can get in touch with us via a toll-free number
+1-800-596-0806 or chat with experts.

Frequently Asked Questions

Should I Add a PayPal Account to the QuickBooks Chart of Accounts formally?

That’s depends. If you leave money in the account, the answer is unquestionably yes, as you would want this monetary asset to be shown on your balance sheet. Furthermore, in order for QBO to accurately record the transfers of monies between your checking account and PayPal account, you must have your PayPal account entered.

How Frequently PayPal Transactions are updated?

After a transaction is completely finished via PayPal, it will come in the For Review tab of the banking screen in 2 hours.

close btn

Get Your Case Study

Call Now+1-800-596-0806