cancel
Showing results for 
Search instead for 
Did you mean: 
userimripersiado
Level 2

Recording collection of security deposit

Hi All,

 

I collected a security deposit for a property that I own. On QuickBooks, I created a deposit and attached it to the security deposit account. How should I record the return of the security deposit to the tenant?

 

Thank you.

Solved
Best answer February 01, 2021

Best Answers
AlexV
QuickBooks Team

Recording collection of security deposit

Hi userimripersiado!

 

I can share two ways on how to record the security deposit and the return of the funds. However, it's best to reach out to your accountant so they can guide you on how to properly enter them in QuickBooks Online.

 

The first one is by recording the security deposit using a bank deposit, the same as what you did. But the affecting account should be an Accounts Receivable (A/R). Then, you can create a check affecting the A/R to record the return of the security deposit. You can go back to your deposit and correct the details.

 

Another way is to record the deposit as a liability. Then, you can use it to pay back your tenant using an expense transaction. For the detailed steps, please check this link: Record a retainer or deposit. Proceed to the Pay customer expenses with money held in the liability account section.

 

Leave a comment below if you need more help. We'll respond as soon as we can.

View solution in original post

3 Comments
AlexV
QuickBooks Team

Recording collection of security deposit

Hi userimripersiado!

 

I can share two ways on how to record the security deposit and the return of the funds. However, it's best to reach out to your accountant so they can guide you on how to properly enter them in QuickBooks Online.

 

The first one is by recording the security deposit using a bank deposit, the same as what you did. But the affecting account should be an Accounts Receivable (A/R). Then, you can create a check affecting the A/R to record the return of the security deposit. You can go back to your deposit and correct the details.

 

Another way is to record the deposit as a liability. Then, you can use it to pay back your tenant using an expense transaction. For the detailed steps, please check this link: Record a retainer or deposit. Proceed to the Pay customer expenses with money held in the liability account section.

 

Leave a comment below if you need more help. We'll respond as soon as we can.

View solution in original post

userimripersiado
Level 2

Recording collection of security deposit

Thank you for your reply.

The way I set it up is with a liability account. So, just to make sure I get it right. When I return the funds, I create an expense with the same liability account attached to it?

 

Imri

AlexV
QuickBooks Team

Recording collection of security deposit

Yes, you're right, Imri!

 

This will offset the amount on your liability account. This method will also prevent it from appearing on your Profit and Loss report.

 

You'll want to check the link I shared in my previous reply for additional details.

 

Comment again if you have other questions. Take care!

Need to get in touch?

Contact us
Sign in for the best experience
Ask questions, get answers, and join our large community of QuickBooks users.
Sign In / Sign Up