Please help - I don't know how to enter this expense that is offset by a credit larger than the expense

Thanks for laying out the details of your concern, Angela. I can help you handle these expense transactions you want to enter in QuickBooks Online (QBO).

You'll want to create a vendor and a bill to record the expense. You can follow the steps below.

Here's how to enter a vendor credit:

1. Click + New and select Vendor credit.
2. In the Vendor dropdown, choose your vendor.
3. Enter the Category details or Item details depending on how you record purchases with this vendor. Usually, this is the category, product, or service you’re getting credit for.
4. Click Save and close.

Once done, you can now enter the bill. I'd be glad to guide you on how:

1. Click +New and select Bills.
2. Choose the vendor.
3. Enter the details needed, then hit Save and Close.

Then, use the vendor credit to pay the open bill. You can follow the steps below:

1. Open the bill you want to pay and click the Make Payment button.
2. In the Bill Payment, the bill is marked as an Outstanding Transaction.
3. Go to Credits and choose the exact amount.
4. Select Add, then Save and close to confirm.

Moreover, you can record the rental income by creating a sales receipt or an invoice and receiving payment.

Also, this guide can serve as your reference to record a credit from a vendor: Enter vendor credits and refunds in QuickBooks Online.

On the other hand, check out this article for more insights if you need to review all your vendor transactions in QBO: View vendor transactions.

Feel free to reply below if you still have questions about handling your expenses, vendor credits, or other transactions in QBO. We'll be right here to help.

Dear Carneil,

Thank you for your quick and thorough reply. I can see that this will keep my accounts balanced correctly with the HOA, but I also need to track the payments that have been made by various renters and to apply the payments to the invoice of the correct renter.

Renters are initially invoiced for a deposit and partial rent to hold the unit for them and then the balance is due 90 days prior to the rental period. Because this is a vacation rental, partial payments come in for multiple renters during the same month and I need a method of ensuring that each renter's payments are applied correctly.

Thank you for any additional help you can offer for this part of the equation.

Angie

Hello Angela. Thanks for your response and detailed information regarding your concern. Let me assist you in accurately recording the payments for the correct renters in QuickBooks.

You can record rent from your tenants in two ways. It depends on when you receive the actual rent payment. Create an invoice if you receive payments at a later date or sales receipts if you receive their payments right away.

Before doing so, you must add your tenants as customers to QuickBooks. Then, you can follow the steps below to record the rent income.

Here's how to create an invoice:

1. Go to the + New button and select Invoice.
2. Complete the fields with the necessary information.
3. Select Save or Save and send.

To receive the payment:

1. Go back to the + New button and select Receive Payment.
2. Choose a customer or tenant, then select the invoice/s you want to close out.
3. Select the payment method and account to which the payment will be deposited.
4. Click Save and close.

You can follow this article for detailed guidance on creating invoices in QuickBooks Online. Then, you can now record the invoice payments. 

If they've made payments right away, you can use a sales receipt. Here's how:

1. From the + New button select Sales Receipt.
2. Choose the name of the customer.
3. Add the sales information, then select Save and Close.

See this article for more information: Create and send a sales receipt. Also, here’s more information about when to use an invoice or a sales receipt.

I also suggest reconciling your accounts every month. This practice aids in monitoring your income and expense transactions to identify potential errors. For more details, open these links:

• Learn the reconcile workflow in QuickBooks
• Reconcile an account in QuickBooks Online

Feel free to ask questions about recording payments for your renters or any inquiries about QBO. Just reply below, and I'll follow up to assist you. Stay safe.

Dear Quickbooks,

I appreciate the prompt replies to my post, however each of the replies is focused on just a piece of my question and doesn't address the entirety of my question. 

I understand how to enter a bill and post a credit to a vender and I understand how to enter a tenant as a customer and accept a payment. What I can't figure out is how to address my particular issue which is that the credit which is showing up on an invoice from my HOA is also a rental payment. Leaving the credit on my HOA account does not apply the payment to my renter's invoice and I can't figure out how to accomplish both of those things in the same transaction or series of transactions. Because this is a vacation rental and the payments are typically partial payments for future rentals and I might receive multiple reservation payments in the current month for future rental dates, I need to be sure that each tenant's accounts receivable is credited correctly.  Please re-read my initial post and advise how to accomplish both of the issues - entries that show the credits that have been applied to my HOA account but have not been received by me and simultaneously crediting the correct tenant for the payment(s) that have been received by the HOA. The renter payments are basically being kept in a HOA holding account until an actual check is sent to me at a later date. But in the meantime, the renters accounts need to reflect the date and amount of the payment that has been received. 

Thank you in advance for giving me the guidance that covers the entire equation -

Angie

Let me assist in managing prepayments and apply these to future invoices in QuickBooks Online (QBO), Angela.

To handle this situation, let's record a retainer or deposit and ensure the HOA account is under a liability account.

To begin with, let's create a liability account. Retainers must be recorded in this account because they represent money your business has received but not yet earned:

1. Go to Settings and select Chart of Accounts.
2. Click on New.
3. From the Account Type dropdown, choose Other Current Liabilities.
4. From the Detail Type dropdown, choose Trust Accounts - Liabilities.
5. Enter a name for the account (Retainers).
6. Click Save and Close.

Second, let's create a retainer item. It's used to track prepayments and allows you to apply it to future invoices:

1. Go to Settings and select Products and Services.
2. Click on New and select Service.
3. Enter a name for the item (Retainer).
4. From the Income Account dropdown, select the liability account you created.
5. Click Save and Close.

Third, let's create an invoice for deposits or retainers:

1. Go to the + New button and select Invoice.
2. Choose the Customer (tenant).
3. Select the retainer item you created.
4. Enter the amount received for the retainer or deposit.
5. Once done, select Save and Close.

Lastly, when you invoice the tenant for future rentals, you can apply the HOA credits for both incomes and expenses:

1. Go to + New and select Receive Payment.
2. Select the tenant and the invoice.
3. Apply the retainer amount to the invoice.
4. Once done, click Save and Close.

For more detailed information about retainers, please refer to this article: Record a retainer or deposit.

For future reference, you can utilize this article to generate reports and give you different aspects of your business: Run reports in QBO.

Feel free to ask more if you have any more questions or need further assistance handling prepayments for future invoicing. Have a good one.

Hello Carl - 

Thank you for your assistance - I believe that you have addressed and offered a solution to all the aspects of my situation relating to my vacation rental and the Homeowner's Association. I will set up my accounts as you have suggested and verify that it's working with the OBO report feature. I appreciate your

time and thoughtfulness in helping me with this.

Have a nice day,

Angie

Hello Carl - 

Thank you for your assistance - I believe that you have addressed and offered a solution to all the aspects of my situation relating to my vacation rental and the Homeowner's Association. I will set up my accounts as you have suggested and verify that it's working with the OBO report feature. I appreciate your

time and thoughtfulness in helping me with this.

Have a nice day,

Angie