Credit/Debit contributions

[colmi]

We have just set up a merchant account to accept debit cards. I assume we would just enter these transactions as cash contributions.

My problem is that we use the accounting module as well, and if we post these contributions to the accounting module, the amount will not reconcile with our bank deposit because the fees are deducted before the money goes in the bank.

Just curious how other PC users handle credit/debit card contributions. The fees are actually an expense to us for providing the ability to use credit cards, just like a bank fee for making a deposit into our account. I saw another post where a user considered Paypal fees charged as a service provided to the user and did not give them full credit for the contribution. I disagree with that...the Paypal fees are not a service provided to the contributor...they are an expense to the church.

My question is how to deal with the direct posting from the contributions module not reconciling with the actual deposit to our bank account.

Thanks...

[Matt]

Here's an idea to consider. You could set up a new contribution fund called "Debit Card Fees". Set up the debit account with an expense account, i.e. "Bank Fees Expense" and make the credit account your bank account. Then, when you post contributions made via debit card you will need to make entries to at least two funds--the actual fund for the contribution amount and the "Debit Card Fees" fund for the bank fee. When you post to Fund Accounting the debits and credits to the bank account will net to the actual deposit amount and the expense will post to the proper expense account.

[Dave-Trailhead]

The solution here seems to be great. I just have one issue, when I go to post the contributions and update fund accounting the final total for the envelope number is going to be subtracted the amount of the fees, which is the problem we were trying to avoid in the first place. My goal is to have the bank account reflect the true balance with the contributor being able to have the full amount they gave reflected on their statement.

Do I need to create a new envelope number called debit card fees just for entering those fees in the new contribution fund, or is there a better way to accomplish this?

[debbie]

The way I did it: I set up an expense account for PayPal Fees. When PP funds were received, I entered them thru Contributions for the full amount.
I then posted them with the option of updating Fund Accting. They were sent them to Fund Accting, and I then went in to "Modify Unposted Transactions" and added the next 2 lines to credit the amount of the fee.
You could also just enter the expense thru Fund Accting/Enter Transactions. I did it this way so it would show up with the actual contribution with the contributor receiving the full credit.


CONTRIB.PAYPAL 1/2/2008 CO January 2008 Contributions 01/02/2008

01-1110 Bank Contributions 01-1110 (debit) 200.00
01-4030 Tithes General Tithe Fund (credit) 200.00
01-1110 Bank (credit) 6.10
01-5425 PayPal Fees (debit) 6.10
From: Contributions on 01/08/2008

[Matt]

Dave--yes, you would need to create a new envelope number to record the fees under the method I proposed. You could also input the fees using Debbie's method. Recommend that you use the method that you find easier to use.

[dozment]

Hello! First I apologize in advance for awakening a very old post. My church has been considering using PowerChurch, and we are considering our options for e-giving. One option that looks interesting is PayPal. Do the PayPal fees that are entered in the expense account get entered one time per batch, so to speak, or are they entered for each transaction? If it is a per transaction thing it seems like it could take considerable effort to add one e-gift.

Thanks, and I hope to be back as a PowerChurch user very soon!

Dan

[NeilZ]

Hello! First I apologize in advance for awakening a very old post. My church has been considering using PowerChurch, and we are considering our options for e-giving. One option that looks interesting is PayPal. Do the PayPal fees that are entered in the expense account get entered one time per batch, so to speak, or are they entered for each transaction? If it is a per transaction thing it seems like it could take considerable effort to add one e-gift.

Thanks, and I hope to be back as a PowerChurch user very soon!

Dan

You do not need to enter each fee transaction separately, you can add them together then lump it in one entry once all the normal Contributions are entered.

[LindsayNicole]

Here's an idea to consider. You could set up a new contribution fund called "Debit Card Fees". Set up the debit account with an expense account, i.e. "Bank Fees Expense" and make the credit account your bank account. Then, when you post contributions made via debit card you will need to make entries to at least two funds--the actual fund for the contribution amount and the "Debit Card Fees" fund for the bank fee. When you post to Fund Accounting the debits and credits to the bank account will net to the actual deposit amount and the expense will post to the proper expense account.

We were also having this same problem and found your post on this thread. We followed Matt's directions and everything balanced. The problem we are now having is when printing out our report forms, the fee is added into our contributions total. --- Not only is it showing on our report form as an expense (which is what we want) but it is also showing up in deposit total. Any ideas how to fix this????

[Matt]

Can you tell me the specific report (s) you are referring to?

[LindsayNicole]

The forms are the income and expense reports that list income fund totals and expense fund totals for each month run monthly.
What was done in contributions was I created a new envelope number with bank debit fees. Then entered the total amount of fees for the month of august which totaled 4.22. A expense account was created for this fee also in contributions with the bank account as a credit. It was first in as a -4.22 but that was wrong so changed it back and then did it as you said. But not with a minus 4.22. In reconciling the 4.22 was what I needed to balance. It added the 4.22 in contributions. The 4.22 went in as an expense in bank creditcard fees expenses too which was right. I balanced but there is a 4.22 in income more than bank statement says......????

[Matt]

Let me make sure I am understanding your question correctly with the following example.

Let's say someone gives $100.00 using their credit card. But the credit card company only deposits $97.00 into the church checking account because there is a 3% fee.

That being the case, the Income and Expense Statement would look as follows using the directions I have given earlier in this thread:

Income: $100.00

Expense: $3.00

Net Income: $97.00

Using this example, are you saying that the Income line should only show $97.00 instead of $100.00 because that's how much the actual deposit to the checking account was?

[LindsayNicole]

Using your example totals. The income shows 100.00 and 3.00 and expense shows three.

[LindsayNicole]

And I want it to show the expense fee as 3.00 and the income as the whole 100.00 not 97.00. ( which it shows 100.00 b) ut also has the 3.00 in the deposit total which is off from the bank statement total.

[Matt]

It sounds like you don't have the debit and credit accounts on the Contribution Items set up correctly. Using this example, you would have two Contribution Items--one for the contribution itself (e.g. General Fund) and one for the fee. They should be set up as follows:

General Fund--Debit checking account; credit income account

Fee--Debit expense account; credit checking account

So, when you input this contribution it would be input as follows:

General Fund - $100.00
Fee - $3.00

Then, when you post to Fund Accounting the accounting entry will be:

Debit checking account- $97.00
Debit expense (Fee) - $3.00
Credit Income account - $100.00

[LindsayNicole]

Matt, since this is the first month we are having website,etc givings.....I did what needed to be done as far as putting deposits by website givings and such, with whole amount of the givings in and setting up accounts where each 4 contributions had their debit creditcard fees taken out in bank statement and I put them in their expense accounts for creditcard fees. I balanced but still in contributions T & O funds I have 4.22 over still. because I had this amount in so many times in dealing with corrections should I still have to reverse this again.