Error: You need to specify an account to credit the deposit to.

Hi there, baemith.

Let me help ensure to isolate the error you're getting so you can create an invoice successfully. 

When creating an invoice, make sure to select the correct account where the funds were received on the Deposit to drop-down menu.  

If the error persists, let's process troubleshooting steps by opening your QuickBooks account in incognito/private mode to check if it caused by a browser.

Here are the keyboard shortcuts to open a private browser: 

• Google Chrome: press Ctrl+Shift+N 
• Mozilla Firefox: press Ctrl+Shift+P 
• Internet Explorer: press Ctrl+Shift+P 
• Safari: press Command+Shift+N

If it works fine with a private browser, I suggest clearing your browser's cache to start fresh.

You may also check this article for the other option about applying deposit directly into bank account: Deposit customer payments. 

Please let me know how it goes. I'll be around to help if you have other questions about creating an invoice. Have a good one. 

Thank you for your detailed response JanyRoseB.

I'm adding (retainer) where relevant to clarify when I'm talking about a deposit received from a client prior to the job being done, vs a generic deposit to the bank. Although for our company's purposes it's not a retainer. 

I tried selecting an account as per your instructions, but the 'deposit to' field only allows an asset account to be selected. Client deposits (retainer) are set up on the books as a liability. I need the liability account to be debited when listing the deposit (retainer), previously received, that is being applied to the invoice, reducing the balance due.  

Am I wrong in understanding what this feature is meant to do? I'm not depositing the customer deposit (retainer) at this point, it may have been received months ago. I'm just trying to clear up the liability plus show on the invoice that the total owing is reduced by the initial deposit (retainer).

This is the procedure I've been doing up to now:

Sales Receipt - Upon initial contract signature and receipt of deposit (retainer) - Single line item called 'Customer deposit' on the receipt, which is linked to a current liability account, not a sales account. 

Invoice - Upon job completion - Along with the details and price of work done, the same 'Customer deposit' line item is added as a negative amount in the invoice details, which debits the liability account and reduces the balance owing. This is correct for accounting purposes, but would be preferable if the deposit(retainer) was listed after the subtotal + tax + total lines on the invoice that is sent to the client. To date, we've been creating the client's copy of the invoice in an excel template, as listing the deposit (retainer) amount like this has created too much confusion.

Thanks again for the help!

Cheers,

Dave  

Thanks for getting back to me, baemith.

First, I'd like to acknowledge your effort in adding very detailed information about your concern. In addition, the retainer or deposit is treated as a liability to show that, although your business is holding the money from a deposit or retainer, it doesn't belong to you until it's used to pay for services. 

When you invoice the customer and receive payment against it, you'll turn that liability into income.

To manage and record a retainer or deposit from customers, make sure to follow the detailed steps in this article: How to record a retainer or deposit. 

If you need further assistance with the steps, I recommend contacting our QuickBooks Online Support Team. They have additional tools to pull up your account and do a screen-sharing. 

Here's how you can contact our customer support:

1. Sign in to your QuickBooks Online company.
2. Select Help (question mark icon) at the top right.
3. Select Contact us to connect with a live support agent.

Please know that I'm just a post away if you have additional questions about the retainer or deposit. Wishing you and your business continued success.

Did you resolve this issue? I'm having same error, I also will like to use this feature of having the deposit on the invoice form instead of creating a product with negative amount at the end. 

Thank you

Based on all of this responses and how frustrating it is not get the correct response, I decided to resolve this myself and  I succeeded. To get rid of the error you have to go your company-accounts and setting—sales-sales form content-deposit and turn it ON. After you do this it will let you save your invoices and your are good to go!

Now, the  problem is it doesn’t reflect previous deposits and  doesn’t balance the deposit account. When you turn the button on it doesn’t create a account in the charts of account like the discount button does, it will go where you have set up all your deposits to go, probably your bank. You would see this when you check your journals entry. 

Hope this helps.