unapplied payments

You've come to the right place for assistance, Carolexx. I appreciate your detailed information when handling unapplied payment transactions and open invoices from previous years. Let me provide insights to help resolve this issue for you.

In regular scenario, you need to edit the deposit transaction created and make sure the accounts affected by it are not sales, but Accounts Receivable. This will close any balances of an open invoice and will ensure amounts are accurately credited.

Then, process payments for open invoices and apply or select Discounts and Credits to zero out the balances of your account. To do this:

1. From the QuickBooks Home page or the Customers menu, select Receive Payment.
2. In the Received From drop-down, select the customer's name.
3. Enter the Amount received.
4. Make sure the date is correct, then choose the Payment method.
5. Click the invoice or invoices you'd like to pay.
6. To add a discount or credit, select Discounts and Credits.
7. Then, click Save & Close.

Since you have also mentioned that these transactions are part of the closed years, the best way to correct the balances is to create a journal entry dated to the current period. This requires the attention of your accountant to seek additional guidance in handling these transactions.

In addition, if you encounter discrepancies when reconciling this year's financial data, you can check out this guide for more detailed information: Fix issues when you're reconciling in QuickBooks Desktop.

I'm all ears to any added queries you may have when handling unapplied transactions in your account. Just keep me posted, and I'll make sure to get you covered. Keep safe and have a good one!

@Carolexx 

@FateCandylaneT's response is incorrect.  Do not edit any transactions from previous years.  That will change your balance sheet (and possibly your P&L) from those closed years.

You mentioned:

"I have 14 unapplied payments from 2017 through 2020 closed years sitting in my open invoices and showing up in reports. Can I delete those unapplied payments and if not, how can I get rid of them since they are paid."

There are a couple things to sort through here.  Just to confirm, you have 14 credits (negative balances) showing in your open invoice report, correct?  And those are duplicate entries that are no longer needed and you want to clear them, correct?  If that's the case, then you must also have 14 deposits that need to be reversed because, when you use Receive Payment, you need to select an account under 'Deposit To'.  QB then creates a deposit to the account selected in the 'Deposit To' drop-down menu as well as a credit entry to A/R.  It is the credit entry to A/R that you're trying to clear.  But, when you created the credit entry, you also created another entry that is now wrong and needs to be reversed at the same time.  Double-entry accounting always affects two accounts. 

So, we need to determine what other account needs to be reversed when we clear the A/R credits.  Do you have 14 deposits showing up as unreconciled?  If not, what account was selected under the 'Deposit To' drop-down on the A/R credits showing on your open invoice report?  It is those account(s) that we need to reverse as well as the unapplied payments.  Once you can identify what other accounts have been affected, we can clear all this up with journal entries.  Just let me know.  

@Carolexx 

Whatever account you or your CPA determine is the offset account from my previous post, create a separate journal entry for each customer that debits A/R and credits the offset account for the amount of the unapplied payment.  Add the customer under 'NAME' on each A/R line of the journal entry.  Then, go to Receive Payments and apply the credit (unapplied payment) to the amount due that was created by the journal entry.  You should be all set.