Help needed with applying customer credit card refund

Thanks, I appreciate your help.   I entered the deposit as you suggested.

The problem still remains that the invoice shows that it is paid in full.  Is there some other place that would show they still owe us $1,500? 

Right now, all I have to send them is an invoice that's marked paid and a credit memo that's marked refunded.  I don't have anything that shows they owe $1,500.

Even an open balance report shows zero.

And then when I do get the payment, I'm not sure what to do with it since there doesn't seem to be anything that needs paid.

Am I thinking about this wrong? Like maybe it should be a customer loan or something like that?

Hi there, @kvioland.

I'd be happy to help share additional insight about recording the payment and refund in QuickBooks Desktop.

The following are the scenarios when to use a credit memo in QuickBooks:

• Used to return an item that your customer already paid
• Credit amount can be issued as a refund or retained in your customer account
• Credit amount can be applied in the next invoice of your customer
• Helps you to track your sale, payment and return item

In your case, there's an overpayment, and the customer wants to get their money back. To fix this, you can just use a refund check. I'm adding the following article for further reference: Record a credit memo or refund in QuickBooks Desktop.

Since you already issued a refund through the credit memo, you can delete the credit memo. Then, edit the payment and enter the correct amount you receive to change the invoice status to open. 

Here's how: 

1. From the Customers menu, select Customer Center.
2. Select the name of the customer.
3. Double-click the payment.
4. Change the PAYMENT AMOUNT (500).
5. Click Save & Close. 

After that, delete the bank deposit so that it'll not offset the customer payment. Once done, run the Customer QuickReport to see the balance on your invoice. 

Here's how:

1. Open the invoice.
2. Select the Reports menu.
3. Click the QuickReport icon. 

Please know that I'm just a post away if you have additional questions about this. I'll be happy to help you further. Have a great day ahead. 

Thank you for helping, MaryGrace.

The original $2,000 payment was part of a deposit a few days earlier, which has already been recorded.

When I try to change the amount of the payment from $2,000 to $500 it is telling me I need to delete the payment from the deposit.   I  could do that, but then the deposit wouldn't match the bank statement.

Is there another way around this?

Hi there, @kvioland.

Thanks for getting back to this thread and trying the recommendation I provided in my previous post. 

To make sure I'm on the same page, do you have a merchant account? If so, instead of editing the payment, let's just make sure the Accounts Receivable account is used in the check refund. This way, the deposit still matches your bank statement. 

Here's how to check: 

1. From the Customers menu, select Customer Center.
2. Select the name of the customer.
3. Double-click the check refund.
4. Go to the Expenses tab and select Accounts Receivable.
5. Click Save & Close. 

You may also want to indicate in the Memo section that this check is a refund to the customer's credit card payment. For more details about creating this, see this article right here: Record A Refund In QuickBooks Desktop. 

That should get you back in track. You can always get back to this post or click the Reply button if you need clarifications. I'm also willing to answer your follow-up refund questions. Wishing you well. 

Thank you very much both @Anonymous  and @MaryGraceS , everything looks perfect now.

You have both been very helpful and I appreciate the time you have taken to explain everything so well to me.

I have followed the instructions both of you have given me, and see that the methods you suggested all get the desired result of showing the customer still owes us and having something to apply their eventual payment to, as well as leaving a trail of exactly what happened. 

I'd like to mark both as solutions to the problem, but don't know if I can.

Thank you again!

I have the same situation but I am using QBO version and I can't follow your steps above.  Is this answer for the desktop version? 

Yes, this is for QB Desktop.

Thank you for joining into this thread, @FabianaT!

I can show you the steps in applying a customer credit card refund in your QuickBooks Online.

To start with, the Sales page shows all your transactions for your customers. With this, let's go to your customer's transaction list and edit the payment of your customer's invoice. Here's how:

1. Go to Sales.
2. Select Customers.
3. Find and click to open your customer's transaction list.
4. Locate and select to open your customer's invoice with a credit card payment.
5. Open the received payment transaction.
6. Enter the amount.
7. Click Save and close.

From there, you can write a check as a refund for your customer. Let me show you how:

1. Go to the Plus icon.
2. Under Vendors, select Check.
3. Select a Payee and Payment date.
4. Choose the bank account you used to receive your customer's payment.
5. From the CATEGORY column, select your accounts receivable.
6. Enter the refund amount.
7. Under CUSTOMER/PROJECT, select your customer who will receive the refund.
8. Click Save and close.

Now, here's how you can zero out the opening balance of your customer receiving the refund:

1. Go to the Plus icon.
2. Under Customers, select Receive Payment.
3. Select your customer who received the refund.
4. Choose the bank account where want to take out the refund amount.
5. Click Outstanding Transactions and Credits. Make sure you received a zero amount of payment.
6. Click Save and close.

Once completed, I'm confident you can be able to issue a refund for your customer but still have the outstanding balance to be paid.

In addition, here's an article you can read to learn more about recording a refund for your customers: Record a Customer Refund.

Lastly, feel free to check this article for your future reference: Enter and Apply a Credit Memo or Delayed Credit.

Let me know in the comment section down below if you have any other concerns. It'll always be my pleasure to help.

I have a customer I need to refund the credit card payment only, the invoice is still payable.  

Hi there, @HYPR.

Do you need to refund a payment you accepted with QuickBooks Payments? If the transaction hasn't settled yet, you have the option to void a payment. QuickBooks lets you know if you try to void a payment that's already settled.

1. Sign in to QuickBooks Desktop.
2. Go to the Customers menu and select Customer Center.
3. Select the Transactions tab.
4. Select Sales Receipts or Received Payments.
5. Find and open the receipt or payment.
6. Go to the Edit menu and select Void Sales Receipt.
7. Select Save & Close.

If you'll want to refund a credit card, QuickBooks takes care of the processing. Here's how:

1. Sign in to QuickBooks Payments from QuickBooks Desktop.
2. In QuickBooks Desktop, select the Customers menu and then Credit Memos/Refunds.
3. In the Customer:Job dropdown, select the customer you need to refund.
4. Enter the products and services you need to refund.
5. When you're done, select Save & Close. This opens an Available Credit window.
6. Select Give a refund and then OK. Or if you want to give credit for future payments, select Retain as an available credit and then OK.
7. In the Issue a Refund window, select how you want to refund the transaction from the Issue this refund via field. If you select Cash or Check, select the account you're paying for the refund from.
8. When you're ready, select OK.

You can check out our guide on voiding and refunding customer payments in QuickBooks Desktop for your convenience.

On the other hand, if you're not using QuickBooks Payments to process your customer payments, check out this link for more info: Give your customer a credit or refund in QuickBooks Desktop for Windows.

Please let me know if you need further assistance. I'm always around to help. 

I have several vendor credits to apply for returned goods. The original vendor bills have already been paid. We will not receive any cash/credit for the returns only a credit notes. We now have a credit with the vendor and I already posted as credit invoice but how do I apply the credit payment and reflect to bank feed and see on bank reconciliation.