Hello there, @klminer. Welcome to the Community space. I can help you get rid of the uncollectable loan on the Balance Sheet report. You have to write off the unpaid invoice and declare it as a bad debt. This is to clear your accounts receivable and reduce your net profit by its amount. First, you have to create an account for bad debts:Click Lists.Choose Chart and Accounts on your mouse and choose New.Choose the Expense radio-button.Click Continue.Enter the appropriate information.Select Save & Close.Next, record the bad debt:Click Customers.Choose Receive Payments.Select the name of the customer.Leave the amount field at 0.00.Highlight the line item that will not be paid.Select Apply Credit button.Go to the Discount tab.Enter the necessary information.Select Save & Close to record the payment.For additional insight, please refer to this article: Write off bad debt. That's it. I'm still here to help you more if you have follow-up questions. Just add a comment or mention my name.

Question

Get rid of uncollectable loan on balance sheet

Forum|Forum|7 years ago
February 22, 2019
8 replies
23 views

No text available

QuickBooks Desktop

HoneyLynn_G

Level 6

Hello there, @klminer.

Welcome to the Community space. I can help you get rid of the uncollectable loan on the Balance Sheet report.

You have to write off the unpaid invoice and declare it as a bad debt. This is to clear your accounts receivable and reduce your net profit by its amount.

First, you have to create an account for bad debts:

Click Lists.
Choose Chart and Accounts on your mouse and choose New.
Choose the Expense radio-button.
Click Continue.
Enter the appropriate information.
Select Save & Close.

Next, record the bad debt:

Click Customers.
Choose Receive Payments.
Select the name of the customer.
Leave the amount field at 0.00.
Highlight the line item that will not be paid.
Select Apply Credit button.
Go to the Discount tab.
Enter the necessary information.
Select Save & Close to record the payment.

For additional insight, please refer to this article: Write off bad debt.

That's it. I'm still here to help you more if you have follow-up questions. Just add a comment or mention my name.

qbteachmt

Level 11

@HoneyLynn_G

Please Learn from this input. They didn't ask about Unpaid sales as AR.

@klminer

You need to work with a CPA, to know what this is Written off against. We don't know who loaned what to whom or when. Since QB is meant for business Bookkeeping, you might have a situation that requires reporting this on 1099-C, as well. Or, it never was business lending and the write off should be against Equity. Or, that is to a shareholder, so there will be a change in their K-1 and might be capital gain or taxable income for them.

No one on the Internet can help, because we are not party to the details.

J

JC -HTX

I'm trying to write off a bad non-customer loan, and can't find the complete set of steps. The loan is a current asset, and the lendee declared bankruptcy, I need to write off the asset. I created a Bad Debt expense account, then I created a non-inventory Bad Debt product/service item linked to the Bad Debt Expense account. Then I created a credit memo but can't figure out how to apply it to an asset account. This is a non-cash transaction, I want to expense the entire amount of the loan but there isn't any sort of invoice associated--the loan was made to a non-customer.

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