Since a credit memo was applied to the invoice, it'll show as an income and expense in the Profit and Loss report to offset the amount. Thanks for coming to the Community, cgonzalez.īad debt is an income that won't be paid anymore. I'm just a post away if you should have any other questions about how to write off bad debt. Select your QuickBooks for Windows version.

This way, it clears the amount out from your accounts receivable and reduces your net profit. You can enter a credit memo instead of receive payments. The credit amount can be issued in your customer's account as a return and apply it to their invoice. I'd be happy to help you write off bad debt if you're on a cash basis.