How do I record a security deposit that My Customer is asking for?

Hello @kbsitz:    Here is a link to a post I did on security deposits.   You will basically show the entire deposit but add a line item for the security deposit.   The security deposit will be a liability account.  

I hope it helps.  If you have more questions, feel free to reach out.   Real Estate is on of my favorite topics and I have many customer's that have this type of business, including my own properties.

Lynda

Lynda,

Thank you for your reply.  If I setup the "Security Deposit" as Account Type & Detail Type "Other Current Liabilities" - the description reads "to track liabilities due within the next twelve months that do no fit the Other current liability account types".  Would this still be accurate to use even though I may not get My Security Deposit back from the brokerage for years to come?  (I would only receive it back when I leave the brokerage.)  Just confirming.

Also, there is a spot when setting up the Account for "Unpaid Balance" "As of" date.  Do I leave that blank?

Thank you this is excellent.

One thing I notice though is that the Sales Receipt for the security deposit displays on the client statement. However, the check I write to return the security deposit does not show on the statement. This is causing some confusion even though the statement shows a zero balance. Any recommendation on how to have the statement reflect the deposit return?

Hello there, @Mike1234.

I'd be glad to share why the returned deposit didn't reflect on the statement.

Checks, Expenses, Bills, and Pay Bills will not show on the statement since these transactions are belong to the vendor side. Only Invoices, Receive Payments, Sales Receipts, and Refund Receipts will show on the statement.

Statement is a summary of your customer's account over a particular period. You can also read this article to know more about statements: Manage Statements.

If you have any other concerns, feel free to leave a comment below.

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@Mike1234 wrote:

Thank you this is excellent.

One thing I notice though is that the Sales Receipt for the security deposit displays on the client statement. However, the check I write to return the security deposit does not show on the statement. This is causing some confusion even though the statement shows a zero balance. Any recommendation on how to have the statement reflect the deposit return?

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The check recorded as a Refund Receipt will show on a Balance Forward or Transaction statement

Malcolm thank you this works.

So, I'm following all of Lynda's recommendations but instead of +Check I'm using +Refund Receipt. Now the statement reflects the client's security deposit, invoices, and security deposit refund correctly.

How do I categorize a security deposit refund in quickbooks?

Hi @klaing7.

You can utilize the same account used when you deposited the customer's deposit. That way, the amount you get back is deposited and you use that same deposit expense as the source account for the deposit.

For more details about prepayments in QuickBooks Online (QBO), here's a great article you can check out:  How to Record A Retainer or Deposit.

You can also consult your accountant for professional advice if you need help in categorizing transactions to the correct accounts.

Feel free to place a comment if there's anything you need assistance with recording transactions. I'm looking forward to working with you again.