Reconciling Card Deposits Without Losing an Afternoon

What the IRS actually asks for

Publication 583 is short and specific. "Your recordkeeping system should include a summary of your business transactions. This summary is ordinarily made in your books (for example, accounting journals and ledgers). Your books must show your gross income, as well as your deductions and credits." It lists supporting documents as sales slips, paid bills, invoices, receipts, deposit slips and cancelled checks, and names credit card charge slips among the documents that show gross receipts, alongside cash register tapes, bank deposit slips, receipt books, invoices and Forms 1099-MISC and 1099-NEC. Publication 334 adds the method question behind it: under the cash method you include in gross income all items of income you actually or constructively receive during the tax year, and you must use an accounting method that clearly shows your income and expenses. Two words decide how you reconcile: gross income. The record that has to survive is what you sold, not what landed in the bank after someone took a percentage out of it.

Reconcile the account monthly, in the order the guidance gives

Publication 583 says to reconcile your checking account each month, and sets out the sequence: check your own figures first, starting from the previous month's closing balance, adding deposits and subtracting disbursements, and only then reconcile against the bank statement. It notes the statement balance may not agree with your books because the statement includes bank charges you have not entered, or does not include deposits made after the statement date or checks that had not cleared. The steps it gives are to compare listed deposits against your own records noting all differences, compare each cleared item against your entries, prepare a bank reconciliation, and update your books for anything shown as unrecorded or recorded incorrectly. Applied to card deposits that is exactly the right shape: match, note, explain, post.

Why a batch and a deposit are allowed to differ

Most unexplained gaps are one of a small number of rule-driven causes. Visa's Section 7.5.6 requires that above the applicable floor limit the clearing amount and the authorisation amount match, unless the transaction falls within Table 7-10, which permits differences for specified categories — up to 20% for taxicabs and limousines, drinking places, beauty and barber shops and health and beauty spas; up to 15% for cruise lines and lodging; the greater of 15% or USD 75 for vehicle rental; and effective 21 February 2026 in the US Region, up to 30% for MCC 5811, 5812 and 5814. The table also states the amounts must always match following a partial authorisation response, for a commercial payables transaction on a Visa Purchasing Card, and in the Europe Region for a European Economic Area transaction. If you run a restaurant or a salon, a settled amount above the authorised amount is the rule working, not an error.

The other three causes, in the order to check them

After clearing variance, check reversals: Table 5-14 requires a merchant to submit an authorisation reversal where the final transaction amount is less than the sum of the authorised amounts, for the difference between them. Then check dates: Section 7.6.1.1 sets transaction date limits — for goods that are shipped, the transaction date must be on or after the shipment date, and for a deferred payment transaction the transaction date must be the billing date, no later than 90 calendar days from the initial shipment date. Then check consolidation, because a single bank credit can carry more than one batch. Refunds and chargebacks come last and get their own lines rather than being netted into the day they happened to hit. Our refunds and voids guide explains why the two are not interchangeable in the records.

Keep fees visible rather than embedded

Because the IRS asks for gross income, a deposit posted as revenue is a record that has quietly deducted an expense from a revenue line. The fix is dull and permanent: record what you sold, record what was withheld, and let the deposit be the arithmetic of the two. Whether your processor funds gross and bills fees separately, or nets fees out of each deposit, does not change what the books have to show — it only changes how much work it is to get there. Our bookkeeping guide covers the account structure, and our QuickBooks guide covers doing it in the software rather than on paper.

An illustrative example of a day that does not tie

Illustrative example, made-up round numbers. A restaurant batches $10,000 across 200 covers and the bank credit is $10,300. Nothing is wrong: tips adjusted after authorisation are settling within the permitted variation for its merchant category, and the difference is a clearing amount legitimately above the authorisation amount. The next day it batches $10,000 and receives $9,600, which is a $400 refund from the previous week clearing in the same window. The third day it batches $10,000 and receives $9,850, and nobody can name the $150 — that is the one to chase, and the only one. Keeping records long enough matters too: Publication 583 ties retention to the period of limitations for the return the record supports. This is general information and not tax or legal advice (September 17, 2026).