How to Write Off Bad Debt in QuickBooks

Learn how to write off bad debt in QuickBooks, by contacting QuickBooks Support Phone Number +-1-800-311-5657

Understanding Bad Debt

There are certain cases when a customer fails to pay the debt that is owned by the company, this shows original invoice unpaid. The QuickBooks bad debt makes the integration process complex and it becomes difficult to generate correct reports. When an invoice becomes non-collectible, you mark it and declare it as bad debt. It is recommended creating an account that can keep a track on such transaction. This will help you in maintaining the records, while maintaining the debt record in a separate register for tax purpose. One can maintain in a custom register but this would make the work more complicated.

Steps to Write off Bad Debt in QuickBooks Online

Step 1: Review Accounts Receivable Aging Report

It is always important to review your accounts receivable aging report carefully, before working on write off bad debt in QuickBooks online

• Open the report section, from the menu present on the left side
• On the search bar option, type Accounts Receivable Aging
• Select the report option. This will show a clear of your outstanding amount receivable

Step 2: Create a New account for bad debt

• To start the process create a new account
• Click on the setting option or the gear icon in the toolbar
• Open your company
• Click on Chart of Accounts
• Click on New
• Click on account type from accounts notification and select Expenses from the drop-down menu
• Now, select Bad Debts, from the drop-down
• Now, enter the Bad Debts in the name field
• Save the option and close the tab

Step 3: Create a Service Item

• Click on the setting option or the gear icon in the toolbar
• Select list, and click on Products and Service list
• Select New
• A new information panel will open in your system and select non-inventory option
• Now, enter the Bad Debts in the name field
• Now, move back to the field for Income Accounts, and then select created account that you had created
• Make sure to check the box of ‘Is taxable’
• Now, save and close

Step 4: Run a Report of Bad Debt

• Click on the setting option or the gear icon in the toolbar
• Open your company
• Click on Chart of Accounts
• Now, find the account that you had previously created
• Select action
• Click on Run Report from the drop-down menu

Hope the above-provided steps have helped you. In case you have any doubt related to any of the above-points call QuickBooks Support Phone Number +-1-800-311-5657