If you connect your bank and credit cards to QuickBooks Online, transactions arrive every day. Each one still has to end up in the right category. Bank rules can suggest where it belongs.
Used well, rules help. Left alone, they can quietly put charges in the wrong place for months. Here is how they work, and where they go wrong.
What a bank rule does
A bank rule says: when a transaction looks like this, categorize it like that. For example:
- A charge from your fuel card company goes to Vehicles: fuel.
- A charge from your plumbing supply house goes to Materials and parts.
- Your monthly software charges go to Software and phones.
How to set one up
In QuickBooks Online, open your bank transactions and find the rules page (in most versions it’s under Transactions, then Rules). Create a new rule and fill in:
- Which transactions it applies to: money in or money out, and which accounts.
- The conditions: for example, bank text contains “SUPPLY” or the description contains your vendor’s name. You can add an amount condition too.
- What to assign: the payee, the category, and, if you use them, the class or location.
- Whether to add it automatically: QuickBooks can confirm matching transactions without review, or leave them waiting for someone to check.
A rule can also split one transaction by percentage or amount.
Where rules go wrong
- One vendor, more than one kind of purchase. The supply house sells parts for jobs and tools for the shop. A rule sends both to the same place.
- Conditions that are too broad. “Contains HOME” catches a lot more than one vendor.
- Rules in the wrong order. QuickBooks applies rules in priority order, and the first match wins.
- Automatic confirmation. A rule that adds transactions without review can file the same mistake every month, unseen.
- Loan payments. A truck loan payment is part interest and part principal, and the split changes every month. A fixed rule can’t keep up with that.
- New vendors and one-off charges. No rule covers them, so they pile up in the review list.
- Rules instead of reconciliation. Rules sort transactions; they don’t prove the books match the bank, or that nothing is missing.
Why the books still need a person every month
Rules only sort. They can’t tell whether a charge was for a job or for the shop, whether a deposit is a customer payment or a loan, or whether something is missing altogether. That takes judgment, every month: reviewing what the rules did, fixing what they got wrong, recording what they can’t handle, and reconciling every account to its statement.
Frequently asked questions
Yes. A rule can split a transaction by percentage or by amount across categories.
Yes. Rules run in priority order, and you can drag them into a different order on the rules page.
Only for simple, predictable charges, and only after you’ve watched the rule work correctly for a while. Even then, someone should review the results each month.
Start with a conversation
If your bank feed has hundreds of transactions waiting for review, or your rules have been filing things in the wrong place, request a free consultation. We’ll clean up the categories and keep the books right every month. Prefer to call? 781-924-1489.