Debt Relief payments

I'm here to help you resolve this matter and ensure the payment is recorded accurately, vbucy.

Let's work together to get to the bottom of this and make sure everything is properly accounted for.

When you record payment to your company, you'll need to create a bank deposit in QuickBooks Desktop. Here's how:

1. On the Homepage, select Record Deposits / Make Deposits.
2. In the Payments to Deposit window, click the Select None tab. Then press OK.
3. Choose the account you want to put the deposit into from the Deposit to dropdown.
4. From the Received from the field, it should be the name of your bank (Firm Checking Account)
5. Select a Date. Complete the necessary information.
6. When you're done, click Save & Close.

I've added these great resources about undeposited funds and recording and making bank deposits in QBDT: 

• Deposit payments into the Undeposited Funds account
• Record and make bank deposits

Please know that I am here to support you every step of the way. Don't hesitate to reach out if you have further concerns about recording payments. Have a good one!

I think you have misunderstood me. I consolidated my debts and make monthly payments to the debt relief company, i.e. $100, in exchange for them negotiating the debt down and paying off the debt. I need to know how to record the payments to the debt relief company. Would I take the debts and 0 them out and put them into a account labled debt relief as a long term liability and then book the payments against that account to lower the liability?

@vbucy 

"Would I take the debts and 0 them out and put them into a account labled debt relief as a long term liability and then book the payments against that account to lower the liability?"

There are a couple of options depending on how you recorded the original debt liability. 

1) If the debt was created with a single entry (i.e. a loan), you will need to lower your debt liability by the amount of debt forgiven and move that to an other income account called Debt Forgiveness.  That forgiveness amount may or may not be taxable income.  You can do that with a simple journal entry - debit the liability, credit Debt Forgiveness (other income). 

2) If the debt was created by entering bills, you can clear them with credit memos assigned to the Debt Forgiveness (other income).  Apply the credit memos to the bills.  Then, move the amount that you owe to the debt relief company to a liability account using a journal entry - debit Debt Forgiveness (other income), credit Debt Relief (liability).  That will reduce the income by the amount of the liability you owe to the debt relief company.

In either case, you will record the payment to the debt relief company as a reduction in the liability.  Assign the liability account to the payment.  If there are finance charges/interest, those should be added at the time you make each payment.