Erroneous credit balance showing on customer account

Hi there, @GNickPDX. Welcome to the Community.

I appreciate you sharing the details of this scenario. You are absolutely right, there is a much cleaner way to bring the balance to zero without creating "fictitious" invoices that would mess up your income reports.

The reason the credit is still showing is that QuickBooks Online (QBO) sees two separate events: an overpayment (Credit) and a refund issued (Refund Receipt). Since a Refund Receipt is a "closed" document, it doesn't automatically offset the credit.

Step 1: Replace the Refund Receipt

To avoid double-counting the money leaving your bank, you must first Void or Delete the original Refund Receipt. Then, follow these steps:

1. Click +Create and select Check.
2. In the Payee field, select the customer.
3. For the Category, select Accounts Receivable (A/R).
4. Enter the credit amount and click Save and close.
   
   **Sample amounts only**

Step 2: Link the Credit to the Check

Now we tell QBO that the extra check they sent you is the "payment" for the refund check you sent them.

1. Click + New and select Receive Payment.
2. Select the Customer.
3. Under Outstanding Transactions, check the box for the Check you created in Step 1.
4. Under Credits, check the box for the Unapplied Payment.
5. Select Save and close.

These steps offset the credit balance showing in your customer's profile.

If you have any follow-up questions, please don't hesitate to click the Reply button.

Hi, @GNickPDX. Just checking in to see if the solution we shared worked for you. Did it fix the issue, or are you still having trouble? Happy to help if you need any more assistance!