Turn on suggestions
Auto-suggest helps you quickly narrow down your search results by suggesting possible matches as you type.
Showing results for
We have to pay one of our customers $5,000 in a lawsuit settlement that we lost. How do I record this transaction?
Solved! Go to Solution.
Record it as a Legal Fees expense when paid. Set up a Legal Fees expense account if you don't have one.
Record it as a Legal Fees expense when paid. Set up a Legal Fees expense account if you don't have one.
Thank you for your response! I appreciate it.
Hello, Rainflurry.
I appreciate you for always sharing your knowledge about QuickBooks. This will definitely help other users as well in the future. Please keep on posting here in the Community.
Keep safe and have a great rest of the day.
What if the payment is to the individual that sued you. I have the payment to the attorney under legal but which account should I use for payment to the individual?
I am in the middle of 1099'ing and realized it shouldn't be under legal for their 1099.
Thanks!
If the payment is to an individual, not a law firm, which account would you use? There were separate payments, a payment to the attorney, which I recorded to Legal but the payment to the individual shouldn't be recorded as legal. This matters for 1099 purposes, as I don't want the payment to the individual appearing as Legal.
Account Type: Other Expense
Detail Type: Penalties & Settlements
Name it as 'Legal Settlement'
So do I need to post the attorney's settlement to 'Professional Fees - Legal Fees'? and the ex employee payments to Other Expense under Settlement? Do I need to record a JE to the Balance sheet to record these payments as it will be for a total of one year we will be making payments to the ex employee and his attorney.
You have clicked a link to a site outside of the QuickBooks or ProFile Communities. By clicking "Continue", you will leave the community and be taken to that site instead.
For more information visit our Security Center or to report suspicious websites you can contact us here