The deposit from Stripe is not your revenue. It is revenue minus fees minus refunds. Recording only the deposit understates income and loses the fee deduction.
The pattern
Customer pays $100. Stripe takes $3.20. You get $96.80 two days later. The correct entry is $100 revenue, $3.20 processing fee, $96.80 to the bank. The bank statement only shows the last number.
How to get it right
- Export the payout report from Stripe, PayPal or Square for the month (each has one: Balance, Payouts in Stripe; Activity, Statements in PayPal; Balance in Square).
- Upload it alongside the bank statement.
- ProfitBooks records each payout as gross, fees and refunds, and matches the net to the bank deposit.
Refunds and chargebacks
Refunds reduce revenue (contra-revenue), not expenses. Chargeback fees are fees. The payout report carries both.
1099-K
Processors send a 1099-K for gross payments. If your books record gross revenue, the form matches your return. If you recorded only net deposits, the IRS sees a mismatch.