As many of you already know, reconciling your merchant account can be confusing and even downright impossible.  This is because most merchant accounts remove the discount fee before depositing your sales into your checking account, so the amount you have in undeposited funds never matches up to your deposits. 

Many simply enter the difference as the merchant account fee, but this defeats the purpose of reconciling your account--which is meant to help you make sure you've received all the cash you're entitled to.  If you're mathematically inclined, you could calculate the discount fee yourself but there's usually different rates for in-person vs. over the phone or Internet sales, which just adds to the confusion.

The easiest way to reconcile your merchant account is to use QuickBooks Merchant Services which has built-in tools that help you reconcile your account.  But many people already have a merchant account they're happy with and don't want to switch.  In this case, simply call them up and ask them to switch your account to "gross daily settlement".  Once you do this, 100% of your sales will be deposited into your checking account and all the discount fees will be debited from your checking account once per month.  If properly managed, this will also help your cash flow-just make sure you have the funds in your account to cover the monthly fees when the time comes!

If your merchant account provider refuses to switch your account, it's probably time to reconsider using them.  QuickBooks Merchant Services offers QuickBooks ProAdvisors like me special rates so if you're interested in switching, contact me at ruth@theQBspecialists.com for a free consultation.

If this answered your question, please consider spending a minute or two posting a review for us. ____________________________________________________________

Written by Ruth Perryman, MBA, CMA, CFE, CFM

Ruth is the president of The QB Specialists, an Intuit Solutions Provider that has helped thousands of businesses nationwide get the most out of QuickBooks and payroll. Ruth has over 20 years of industry experience, including 5 years as a Chief Financial Officer. She is an Advanced Certified QuickBooks ProAdvisor and a member of Intuit’s Trainer/Writer Network. She is also certified in QuickBooks Enterprise and Point of Sale.

Online payroll for only $25.99/month - try it free until April 2010! Instant paychecks, direct deposit, electronic tax payments & completed forms. Call us at 800-707-0940 or visit www.online-payroll.com for more details.

Enjoyed this post? Subscribe to QuickBooks Tips & Tricks via RSS Feed or via Email and receive free daily QuickBooks tips.