How to Write Off an Invoice in QuickBooks
Unfortunately, it is part of every business to come across customers who refuse to pay their debts. Also, after every effort to retrieve your money has proved futile, the only choice left is to write the invoice off as a bad debt. The ways through which you can write off your invoices in QuickBooks are many. However, the step outlined below is the only way you can make adjustments to your sales tax payable account.
Best Way to Write off an Invoice in QuickBooks
No matter how to write off an invoice or how to write off unpaid invoices in Quickbooks, Quickbooks is one of the best invoice software to help you complete.
- Launch your QuickBooks and go to the report menu. Click on customers and receivables from the drop-down lists and select "the open invoices" report.
- Once there, search for the customer you would like to write off and jot down the important information. Information like the customer’s name, the amount owed and the invoice number.
- Once you have the above information, go to the customer center or menu and select create credit memos and refunds. The credit memo screen will open and follow the step below.
- Input the name of the customer and the date of the invoice you want to write.
- Proceed to select the bad debt item you want to write off. If you don’t have a bad debt item, you have to create one.
- To create a bad debt item, go to add new and click on other charge and give it a name. Fill in the appropriate information and select the bad debt account as well then click on ok.
- You can then proceed to fill in all the necessary information – description, amount, sales tax (if applicable).
- Click on save then close and you have finished the steps of Quickbooks write off invoice.
- A new screen informing you of the remaining balance will appear with the option to offer a refund or apply a credit to the invoice. Choose the apply credit to invoice, check off the bad invoice number and then click on done.
Remember, always cross check your account before closing.
How to Use Discounts to Write off Small Amounts
- First, create an account and the item you need to write off the debt. Follow the steps below to create the charge off account.
- Go to the list menu and select chart of account.
- Click on the account and select new.
- Choose income and click on continue.
- Enter all the required information (minor A/R and A/P charge off) then save and close.
- Then proceed to create a charge off item.
- Once you have done all that, then you choose the options from the drop-down that suit the amount you wish to clear. For instance,
- Customer underpayment.
- Customer overpayment.
- Vendor underpayment.
- Vendor overpayment.
Best Alternatives to QuickBooks: FreshBooks
FreshBooks is one of the best alternatives to the QuickBooks available for small businesses and freelancers. It is straightforward to use, affordable and offers top-notch services without much stress. Whether you are looking for your business first accounting software or need different but great software, FreshBooks has it all.
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