One of the benefits of connecting QuickBooks Online (QBO) with Intuit Merchant Processing is that you can run credit cards when you take a Payment on an Invoice, or make a Sales Receipt on the spot.
Unlike with Square or PayPal, the money shows up in your bank account with a matching amount; Intuit deducts its merchant service fees in a separate transaction.
Best of all, in the Plus version you can use Recurring Transactions to automatically charge a customer’s credit card without having to lift a finger.
However, there is an issue with the current version of QBO: if the credit card is declined, the Invoice is still marked as closed. This wreaks havoc with your Accounts Receivable. I have been told that a fix is coming in a future release, but here are a few features that will help you manage declined credit cards in QuickBooks Online.
First, on the home screen’s Activities List, you’ll see a warning to fix declined credit card payments. Click on “Take Action” and you’ll be able to fix the card number and try again.
Another option is to go to your Chart of Accounts and look for a new account called Credit Card Receivables. This account is created by QBO to store those declined charges, so you can see them in a register.
With this list you can reopen your Invoices and recollect payment from your customers.
Hopefully this article will become obsolete, but for now, it helps to know where to look to work around this bug.
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