To apply a credit memo to an invoice in QuickBooks Desktop for Mac or QuickBooks Online, the steps depend on which version you're using. Jump to the section that matches your product below.
QuickBooks Desktop for Mac
Step 1: Create the credit memo (if you haven't already)
- Go to Customers, then select Create Credit Memos/Refunds.
- Enter the items you're giving a credit for, then select Save.
Step 2: Apply the credit to an invoice
- Go to Customers, then select Receive Payments.
- Select the customer on the Customer: Job ▼ dropdown.
- Select the Apply Existing Credits? checkbox.
- Select Save.
QuickBooks will apply the available credit to the customer's open invoices in date order. A few things to know about how this works:
- Credits apply in date order. You can't select which specific credit memo is applied to which specific invoice. QuickBooks applies available credits starting with the oldest outstanding invoice.
- Partial credit application isn't supported. The full credit balance will be applied. If you want to apply only a portion, you'll need to create a credit memo for that specific amount.
- Bulk application isn't available. Credits must be applied manually, one customer at a time.
If the "Apply Existing Credits?" checkbox isn't showing up, make sure you're accessing Receive Payments through Customers > Receive Payments — not through the Receive Payment button on the invoice itself. The option only appears through the Customers menu path.
For more details, including how to write a refund check instead of applying a credit, see: Create and apply credit memos in QuickBooks for Mac
QuickBooks Online
In QuickBooks Online, you can apply a credit memo to an invoice manually, or let QuickBooks apply it automatically.
Optional: Turn on automatic credit application
If you'd like QuickBooks to automatically apply credits to a customer's oldest unpaid invoice, turn on the Automatically apply credits setting:
- Go to Settings ⚙ and select Account and settings.
- Select the Advanced tab.
- Select Edit ✎ in the Automation section.
- Turn Automatically apply credits on or off.
- Select Save, then Done.
When this setting is on, QuickBooks applies the credit to the oldest unpaid invoice and closes it if the credit covers the full balance. Any remaining credit carries over to the next oldest invoice. If there are no open invoices, the credit memo status shows as Unapplied.
Step 1: Create the credit memo
- Select + Create.
- Select Credit memo.
- Choose the customer from the Customer ▼ dropdown.
- Enter the details, such as the date and the amount.
Tip: You can create a custom service item so you can quickly add it as a single line item.
- Select Save and close.
Step 2: Apply the credit memo to an invoice manually
If you have Automatically apply credits turned off, here's how to apply the credit yourself:
- Select + Create.
- Select Receive payment.
- From the Customer ▼ dropdown, select the customer.
- In the Outstanding Transactions section, select the invoice you want to apply the credit to.
- In the Credits section, select the credit memo(s) you want to apply.
Note: If you don't see the Credits section, the customer may not have any credits on file yet.
- In the Payment column of the unpaid invoice, enter how much credit you want to apply.
- Leave Payment method, Reference no, Deposit to, and Amount received blank.
- Fill out the rest of the form, including the payment date.
- Confirm the total looks correct, then select Record and close.
For more, see: Create and apply credit memos or delayed credits in QuickBooks Online
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