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Seattleseven
Level 1

How to record an insurance settlement?

Our auto insurance company has issued us a check for repairs to a vehicle that was involved in a collision.  How do I record this as a non-taxable payment received?

 

Thanks very much!

4 Comments 4
Rustler
Level 15

How to record an insurance settlement?

You post the actual repair costs you paid for, deductible, etc, to an expense account

deposit the funds the insurance company gave you and use that same expense account as the source account for the deposit

 

whether that is income on the P&L (negative expense) depends on whether you got more than you paid

TVo
Level 1

How to record an insurance settlement?

How should I record check received from insurance company for totaled vehicle that was fully paid for?

JonpriL
Moderator

How to record an insurance settlement?

Hello @TVo,

 

In QuickBooks Online, you can create a bank deposit for the check you received from the insurance company of your vehicle. Let me walk you through the steps on how to accomplish this.

 

To start with, here's how you can create a deposit account for your insurance:

 

  1. Go to Accounting.
  2. Select Chart of Accounts.
  3. Click New.
  4. Under Account Type, select the appropriate account type.
  5. On the Detail Type menu, select the category on the nature of your insurance company.
  6. Enter a name of your new account. Say Insurance Company.
  7. Click Save and Close.

 

Once done, you can go ahead and create a bank deposit for the amount of the check you received. You can read this article to learn more: Record and make bank deposits in QuickBooks Online.

 

Additionally, I've also included this reference helpful with a compilation of articles you can use while working with us: Browse all articles for your QuickBooks product.

 

Don't hesitate to post again here if you have other questions or concerns with QuickBooks tasks and navigations. I'm always around happy to help. Stay safe and have a good one!

TVo
Level 1

How to record an insurance settlement?

Owner wants to know if this is considered an Income account?

If I read your explanation correctly..I should create an account (Other Income? per QB description of Other Income that includes insurance reimbursements), in the Detail I should choose Auto Insurance (if one isn't already created?)?

 

What about an account "Loss or Gain on Sale of Assets"? (Other Income acct).

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