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Level 1

Hi- issued refund to a client, and there's no "refund" category in expenses. Am I supposed to just categorize it as "other"? It's not an expense, it's less income...

 
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Best answer May 10, 2020

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Moderator

Hi- issued refund to a client, and there's no "refund" category in expenses. Am I supposed to just categorize it as "other"? It's not an expense, it's less income...

It's great to have you here in the Community, @contact79.

 

Let me share some information on how you can handle this refund in QuickBooks Self-Employed.

 

There are two options you can do for this scenario. Before you start, I recommend reaching out to an accountant or tax adviser to ensure you're posting it to the right account depending on the type of business you have.

 

The first option is to locate the original income you recorded and mark it as excluded. This will be removed from the estimated tax calculation. You don't have to record the refund since this isn't part of the schedule C category.

 

If you need to record this refund, the second option would be to mark it as personal expenses or business other expenses. However, as mentioned in the first option, you'll need to exclude the original income to exclude the estimated taxes. 

 

Let me know if you have other questions you'd like to add. I'm here to help.

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3 Comments
Moderator

Hi- issued refund to a client, and there's no "refund" category in expenses. Am I supposed to just categorize it as "other"? It's not an expense, it's less income...

It's great to have you here in the Community, @contact79.

 

Let me share some information on how you can handle this refund in QuickBooks Self-Employed.

 

There are two options you can do for this scenario. Before you start, I recommend reaching out to an accountant or tax adviser to ensure you're posting it to the right account depending on the type of business you have.

 

The first option is to locate the original income you recorded and mark it as excluded. This will be removed from the estimated tax calculation. You don't have to record the refund since this isn't part of the schedule C category.

 

If you need to record this refund, the second option would be to mark it as personal expenses or business other expenses. However, as mentioned in the first option, you'll need to exclude the original income to exclude the estimated taxes. 

 

Let me know if you have other questions you'd like to add. I'm here to help.

View solution in original post

Level 1

Hi- issued refund to a client, and there's no "refund" category in expenses. Am I supposed to just categorize it as "other"? It's not an expense, it's less income...

Thank you so much! How about if the refund was partial? Also, the income was included in a transfer of a bunch of payments from PayPal. Here's an example: I received $100 from a client and refunded $20. The $80 remaining was transferred over from PayPal transfer of $200 (multiple payments - one transfer). I checked the $200 transfer under transactions and there's no way for me edit it. Sorry if this complicated.

QuickBooks Team

Hi- issued refund to a client, and there's no "refund" category in expenses. Am I supposed to just categorize it as "other"? It's not an expense, it's less income...

You’re welcome, @contact79.

 

You can exclude the $200. Then, manually add your income. 

 

To exclude the transaction: 

  1. Open the transaction from the Transaction page.
  2. Click on Exclude on.
  3. Select Save once you’re done.

To manually add your business income:

  1. Go to the Transaction menu and select Add Transaction.
  2. Add the amount of your business income
  3. Browse the Select a category menu and choose Business Income
  4. Click on Save.

Check this article for more information:

Let me know if there's anything that you need. I'm always here to assist. Have a great rest of the day!

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