What Is an Inclearing Check in QuickBooks? A Complete Guide for U.S. Accounting Professionals

Introduction

If you're managing finances in QuickBooks, understanding banking terms is essential for smooth operations. One term that often causes confusion is the “inclearing check.” It's not something you encounter in everyday transactions but becomes important during bank reconciliation or when reviewing cleared transactions. In this article, we’ll break down what an inclearing check is, how it relates to QuickBooks accounting workflows, and what U.S.-based accountants need to know when they come across it.

What Is an Inclearing Check?

An inclearing check refers to a check that is presented to the payer's bank for payment, and is in the process of being cleared by the banking system. In banking terms, it’s part of the clearing cycle, where the check moves from the deposit bank (where it was deposited) to the paying bank (the bank it is drawn from) for funds verification and transfer.

In QuickBooks terms, an inclearing check may show up in your bank feed or bank statement when a check you issued is in the process of being withdrawn from your account. It has been processed by the bank but may not yet have posted fully in QuickBooks depending on timing or reconciliation status.

Inclearing vs. Cleared Checks: What’s the Difference?

Term	Meaning	QuickBooks Context
Inclearing Check	A check that has been submitted to the payer's bank but hasn't fully cleared yet	Might show up in bank feeds or statement imports
Cleared Check	A check that has been fully processed and the funds have left your account	Marked as “cleared” during reconciliation

In short, all cleared checks were once inclearing, but not all inclearing checks have cleared yet.

Why Do Inclearing Checks Matter in QuickBooks?

For U.S. accounting professionals, accurate reconciliation is non-negotiable. Inclearing checks can cause temporary confusion during bank reconciliations if:

• The check appears on the bank statement but not in QuickBooks yet
• A mismatch in dates between QuickBooks and your bank’s posting
• Duplicate or miscategorized transactions

Inclearing checks can affect cash flow reporting, bank reconciliation, and audit trails.

How to Handle Inclearing Checks in QuickBooks?

Here’s a step-by-step process for identifying and reconciling inclearing checks in QuickBooks Online or QuickBooks Desktop:

1. Check Your Bank Feed or Statement

Download your bank feed into QuickBooks and review any check transactions. Inclearing checks often appear with status "pending" or without a full description.

2. Match With Your Register

Go to your Chart of Accounts > Bank Register, and search for the check number or amount. If the check was recorded in QuickBooks, it should appear there.

• If it’s missing, it may need to be manually entered.
• If it exists but hasn’t been matched, use the “Match” feature in QuickBooks Online.

3. Reconcile Carefully

When reconciling your bank account:

• Look for checks listed on your bank statement but not marked "cleared" in QuickBooks.
• Use check numbers and amounts to confirm which transactions are inclearing.
• Reconcile the transaction only when it’s fully processed by your bank.

4. Use Bank Rules (QuickBooks Online)

Set up bank rules to auto-categorize recurring check transactions. This can help reduce confusion with inclearing checks by improving transaction matching.

Example: How an Inclearing Check Appears in QuickBooks

Let’s say you issue Check #1023 for $1,500 to a vendor on April 1st. The vendor deposits it on April 3rd, and your bank processes it on April 5th.

• In your bank statement, it may appear as “Inclearing Check 1023 – $1,500”
• In QuickBooks, if entered correctly, it will show up in your bank feed awaiting match
• Once matched and cleared, it becomes part of your reconciled bank balance

Common Issues with Inclearing Checks in QuickBooks

1.       Duplicate Entries

·         If you manually record the check and also import it from the bank feed, it might be counted twice.

·         Fix: Use the “Match” function instead of “Add” when categorizing bank feed transactions.

2.       Missing Checks

·         If a check clears the bank but doesn’t exist in QuickBooks, it could indicate:

·         A forgotten manual entry

·         A misnumbered check

·         Fraudulent activity

Fix: Investigate using vendor records and audit trail. Enter missing checks with the correct date and memo for reconciliation.

3.       Timing Differences

o   Sometimes an inclearing check appears on the bank statement in one month, but in QuickBooks in another. This can mess with your month-end reports.

Fix: Make sure the check’s transaction date in QuickBooks aligns with the issue date, not the clear date.

Best Practices for Managing Checks in QuickBooks

• Use Check Numbers: Always use sequential check numbers for easy tracking.
• Avoid “Add” Without Review: Always check before adding transactions from the bank feed.
• Reconcile Monthly: Regular reconciliations help identify inclearing checks and prevent reporting issues.
• Audit Trail: Turn on audit logs in QuickBooks Online for tracking edits or deletions.
• Integrate with Your Bank: Connect your bank account directly to QuickBooks for real-time status on checks.

Inclearing Checks and U.S. Banking Regulations

Inclearing checks fall under Regulation CC, which governs the availability of funds and the clearing process in U.S. banks. Most checks are cleared within 2 business days, but delays can happen.

Understanding this process helps accounting professionals align QuickBooks records with bank realities, especially during audit season or financial closeouts.

Final Thoughts

Inclearing checks might seem like a small detail, but they can have a big impact on reconciliation accuracy and financial reporting. Whether you're using QuickBooks Online or Desktop, knowing how to identify and handle these transactions is critical for clean books and happy auditors.

Need Help Reconciling Your QuickBooks Accounts?

If you're struggling with inclearing checks, mismatched transactions, or unclear reconciliation reports in QuickBooks 2024, we're here to help. Our team of U.S.-based QuickBooks experts can walk you through every step.

Contact Us +1 347-967-4079 Today to schedule a consultation and take control of your QuickBooks with confidence.