Thanks for dropping by the Community, @Kelleen3. Allow me to chime in and help you with sorting this issue with QuickBooks Desktop.

Accounts Payable can also be applied to checks and deposits.

Please see this sample screenshot for reference:

Otherwise, users may experience discrepancies in their company files as a result of data damage. You can use the Verify and Rebuild tools to get this resolved. Also, please ensure that your QuickBooks Desktop is updated.

Here’s how:

1. Go to Window, then Close All.
2. From the File menu, click Utilities.
3. Select Rebuild Data.
4. Follow the on-screen instructions to back up your data.
5. When the tool finishes, select OK.
6. Go to the File menu, then click Utilities.
7. Click Verify Data, then select Rebuild Now once QuickBooks finds an issue with your company file.
   
   

Furthermore, I'm also adding this article for more troubleshooting steps: Fix data damage on your QuickBooks Desktop company file.

I’ll also provide this link to guide you further on how to record vendor refunds in QBDT.

In addition, you can refer to this article for a complete list of workflows and other vendor-related transactions in QBDT. 

Keep me posted if you still have questions or concerns with managing your transactions in QBDT. I'll be around for you. Have a great day!

Nice Job Rustler! In the world of government accounting this is the best solution!!!! I am able to keep my expenditure accounts, vendor payments, AND income receipts all accurately reflecting our activities while not leaving credits hanging out there! Kudos to you!

Hello, livenlearn.

We're glad to know that the steps shared by Rustler resolves your concern about the expenditure accounts, vendor payments, and income receipts. I'm sure this will be useful for other users who are having the same situation.

If you have any additional questions or need help with other task, please let share with us the details in your reply. We're always here to help. Have a good day ahead! 

All of my medical expenses were paid to this vendor in 2022.  I received an overpayment refund check in January 2023.  I need instructions that will show (1) a deposit to the bank, (2) the P&L for 2023 to show a negative amount for that refund (it is the only medical expense recorded this year so far), and (3) I would like the bank to be debited. I am using an old desktop version: Premier Retail 2007

Thank you.

Ignore my question.  I deleted it all and just did a JE debiting the bank and crediting the medical expense account, and put the vendor name in the bank debit column.  Worked perfectly.  It shows the refund in the bank, on the P&L and in the vendor history.

I tried this but I'm confused.  How does a deposit create a bill? I went to "pay bills" and there was no bill there. 

I appreciate you for joining the thread, @ABCCO.

Please know that you can't create a bill through the deposit. Instead, you can use the deposit as a credit and then apply it to your bill transaction to settle it. If you're referring to this process, I'll gladly input the steps below to get you going. To begin, here's how:

1. Access your QuickBooks Desktop company.
2. Go to the Banking menu, and then select Make Deposits.
3. In the Received From section, choose the correct vendor.
4. In the From Account section, select Accounts Payable.
5. Enter the Amount, and then click the Save & Close button.

If you don't have an existing bill, you'll want to create one. See this page for further guidelines: Enter bills in QuickBooks Desktop.

Once done, click the Pay bills button inside the bill you created, and then select the deposit you made earlier. You'll then click the Set Credits button below and choose your deposit. Click Done to apply.

Additionally, you can also check this page to help you manage your bills inside QBDT: Pay bills in QuickBooks Desktop.

@ABCCO, I'll be here in the Community space if you need further assistance accomplishing this task. Please don't hesitate to leave a comment below. I'll get back to you right away. Stay safe! 

ABBCO

All I wanted to do was deposit the check for overpayment on a medical bill.  All this talk about creating an invoice sounds a little absurd to me.  It's a simple journal entry, debit bank, credit medical expense. Put the vendor's name in the bank line of the journal entry. It sounds like they are talking about entering a credit memo.  But the OP asked how to record a REFUND for an overpayment.  That means he got a check, not a credit memo. Nobody needs to enter a bill for a refund check.  That's ridiculous. One wouldn't even enter a credit memo or they will just end up paying the next invoice and applying the credit when the CASH already went into the bank.  So none of what anyone is saying here makes sense at all.  If you get a refund just enter the debit and credit journal entry.  It has nothing to do with accounts payable but you do want to show the refund via entering the doctor's name / vendor in the bank journal entry line. It's just that easy.

Kurt

Your answer is absurd! The guy got a refund check.  You deposit it.  You do not issue a credit memo against it to apply to the next bill.  You do not create an invoice to use it up.  He overpaid the vendor.  He already paid the original bill but wrote the check for too much money and they reimbursed him.  You simply make a journal entry as I've posted.  Why in the world would you EVER make an invoice against money you already paid an invoice on but over paid it? That's really bad accounting.

this was the easiest way to do this.  Thank you!

I tried what you suggested for a $10 refund check from an overpayment we made.  I had already put in the payment and was left with a $10 credit.  When I do what you suggest, I end up with a negative $20 balance instead of the negative $10 balance I had originally.  What am I doing wrong? Isn't there some simpler way? 

Hi there, Mary Anne1.

Can you tell us what steps you followed? We just want to make sure that we give you the right steps and information to sort this. 

Please reply back to us to share more details. We look forward to it. 

Mary Ann 1

We don't know which person you are talking to.

Mary Anne 1:

You should not enter a $10 credit memo when that vendor shows a negative $10 amount due in your vendor listing, or you will get that negative $20 balance because you are compounding it.

Deposit the refund check and do the journal entry I spoke of earlier.

I was responding to Rustler

"deposit the check and use accounts payable as the source account for the deposit, use the vendor name too

bring up pay bills, select the bill that the deposit created and apply the vendor credits, save"

I just ended up with double the credit amount, as you said.

I've used this process to take care of an overpayment that was returned.

Now the total paid for the year to this vendor is reduced by twice. Instead of the once.

Wont this make her 1099 NEC incorrect at year end?