Write Off a Bad Debt in QuickBooks

Write Off a Bad Debt in QB

The bad debt setup in QuickBooks account is important as it shows the amount that is not paid till now. This amount is that you didn’t receive it yet. This amount is created, when your customer did not pay you the amount that they owe from your organization in the form of an invoice.

By making this account, you can easily track it and ask the customer to pay it. It is done in the accounts receivable. Check the bad debts that it’s there or not.

Method to Write Off a Bad Debt in QuickBooks

First of all, locate for the customer having the outstanding invoice. Then create their account for the bad debt to keep them in your accounts and track them easily. Do the process mentioned below to do the setup:-

Total Time: 30 minutes

For Checking the Bad Debt Customer

πŸ’  For this, check all the invoices which are in the bad debt
πŸ’  Now click on the Report menu option
πŸ’  Go to the Accounts Receivable Ageing Details report and open it
πŸ’  The accounts that are shown as outstanding check them all
πŸ’  Then create the account of Bad Debt for that customer from settings
πŸ’  Go to the Chart of Accounts.

For Creating the Bad Debt Account

πŸ’  Go to the Company Menu
πŸ’  Then click on the Chart of Accounts
πŸ’  Now, click the Account option and then in the New button to create new account
πŸ’  In the account type, click on the Expense option then press the Continue button
πŸ’  Enter the account number by selecting the number as the text field
πŸ’  Select the field Account Name and then type the Bad Debt
πŸ’  Then click on the OK button.

For Making a Record in Bad Debt

πŸ’  Firstly, open the QuickBooks
πŸ’  Then select the Customer menu option
πŸ’  Now click on the Receive Payments from further options
πŸ’  After that, choose the bad debt customer from the list shown to you
πŸ’  Now choose the corresponding line item for the bad debt
πŸ’  Go to the option Discounts and Credits
πŸ’  Click on the Amount of Discount field so that you can enter the total for bad debt
πŸ’  Then click on Done option
In the end, click on the Save and Close button to finish it.

For Closing the Bad Debt

πŸ’  In the QuickBooks, select the Customers menu option
πŸ’  Select the option Receive payments
πŸ’  Then in this, Choose the customer name correctly
πŸ’  To remove bad debt, enter the amount as 00
πŸ’  Now choose the Discounts and Credit option
πŸ’  Mention the write off amount
πŸ’  Click on the account that is correct
πŸ’  Then, click on the Save and Close button.

Also Read: How to Create, Schedule Automatic Invoices in QuickBooks

How to get in touch?

That is how to setup a bad debt account in QuickBooks and the other actions that can be done in the bad debt account.

You can easily get in touch with the team if you are facing any issues or have some queries. Connect with them by just dialing the toll-freeΒ QuickBooks customer support phone numberΒ . The members of the team are experienced and experts to handle all the situations easily. You get all the glitches resolved and get all the answers to your queries quickly. You can also reach them via live chat or send them an email at [email protected]


When to Write-off Bad Debt

When you haven’t paid the debt in a significant amount of time, when your financial advisor tells you to, or when it can be proven that you don’t owe the money.

Write Off Bad Debt in QuickBooks Online

All you have to do is log into your QuickBooks Online account with the Dashboard. From there, go to “WriteOffBadDebt” and click the button. You will be able to select the vendor who’s bad debt you’re looking for assistance in removing from your record. The next screen allows you to choose how you want the bad debt written off–payment, partial payment, or outright delete it.

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